Text: H.R.3004 — 107th Congress (2001-2002)All Information (Except Text)

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Engrossed in House (10/17/2001)

 
[Congressional Bills 107th Congress]
[From the U.S. Government Printing Office]
[H.R. 3004 Engrossed in House (EH)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
107th CONGRESS
  1st Session
                                H. R. 3004

_______________________________________________________________________

                                 AN ACT


 
 To combat the financing of terrorism and other financial crimes, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Financial Anti-
Terrorism Act of 2001''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
                 TITLE I--STRENGTHENING LAW ENFORCEMENT

Sec. 101. Bulk cash smuggling into or out of the United States.
Sec. 102. Forfeiture in currency reporting cases.
Sec. 103. Illegal money transmitting businesses.
Sec. 104. Long-arm jurisdiction over foreign money launderers.
Sec. 105. Laundering money through a foreign bank.
Sec. 106. Specified unlawful activity for money laundering.
Sec. 107. Laundering the proceeds of terrorism.
Sec. 108. Proceeds of foreign crimes.
Sec. 109. Penalties for violations of geographic targeting orders and 
                            certain record keeping requirements.
Sec. 110. Exclusion of aliens involved in money laundering.
Sec. 111. Standing to contest forfeiture of funds deposited into 
                            foreign bank that has a correspondent 
                            account in the United States.
Sec. 112. Subpoenas for records regarding funds in correspondent bank 
                            accounts.
Sec. 113. Authority to order convicted criminal to return property 
                            located abroad.
Sec. 114. Corporation represented by a fugitive.
Sec. 115. Enforcement of foreign judgments.
Sec. 116. Reporting provisions and anti-terrorist activities of United 
                            States intelligence agencies.
Sec. 117. Financial Crimes Enforcement Network.
Sec. 118. Prohibition on false statements to financial institutions 
                            concerning the identity of a customer.
Sec. 119. Verification of identification.
Sec. 120. Consideration of anti-money laundering record.
Sec. 121. Reporting of suspicious activities by informal underground 
                            banking systems, such as hawalas.
Sec. 122. Uniform protection authority for Federal reserve facilities.
Sec. 123. Reports relating to coins and currency received in 
                            nonfinancial trade or business.
                  TITLE II--PUBLIC-PRIVATE COOPERATION

Sec. 201. Establishment of highly secure network.
Sec. 202. Report on improvements in data access and other issues.
Sec. 203. Reports to the financial services industry on suspicious 
                            financial activities.
Sec. 204. Efficient use of currency transaction report system.
Sec. 205. Public-private task force on terrorist financing issues.
Sec. 206. Suspicious activity reporting requirements.
Sec. 207. Amendments relating to reporting of suspicious activities.
Sec. 208. Authorization to include suspicions of illegal activity in 
                            written employment references.
Sec. 209. International cooperation on identification of originators of 
                            wire transfers.
Sec. 210. Check truncation study.
          TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

Sec. 301. Special measures for jurisdictions, financial institutions, 
                            or international transactions of primary 
                            money laundering concern.
Sec. 302. Special due diligence for correspondent accounts and private 
                            banking accounts.
Sec. 303. Prohibition on United States correspondent accounts with 
                            foreign shell banks.
Sec. 304. Anti-money laundering programs.
Sec. 305. Concentration accounts at financial institutions.
Sec. 306. International cooperation in investigations of money 
                            laundering, financial crimes, and the 
                            finances of terrorist groups.
                     TITLE IV--CURRENCY PROTECTION

Sec. 401. Counterfeiting domestic currency and obligations.
Sec. 402. Counterfeiting foreign currency and obligations.
Sec. 403. Production of documents.
Sec. 404. Reimbursement.

                 TITLE I--STRENGTHENING LAW ENFORCEMENT

SEC. 101. BULK CASH SMUGGLING INTO OR OUT OF THE UNITED STATES.

    (a) Findings.--The Congress finds the following:
            (1) Effective enforcement of the currency reporting 
        requirements of subchapter II of chapter 53 of title 31, United 
        States Code, and the regulations prescribed under such 
        subchapter, has forced drug dealers and other criminals engaged 
        in cash-based businesses to avoid using traditional financial 
        institutions.
            (2) In their effort to avoid using traditional financial 
        institutions, drug dealers and other criminals are forced to 
        move large quantities of currency in bulk form to and through 
        the airports, border crossings, and other ports of entry where 
        the currency can be smuggled out of the United States and 
        placed in a foreign financial institution or sold on the black 
        market.
            (3) The transportation and smuggling of cash in bulk form 
        may now be the most common form of money laundering, and the 
        movement of large sums of cash is one of the most reliable 
        warning signs of drug trafficking, terrorism, money laundering, 
        racketeering, tax evasion and similar crimes.
            (4) The intentional transportation into or out of the 
        United States of large amounts of currency or monetary 
        instruments, in a manner designed to circumvent the mandatory 
        reporting provisions of subchapter II of chapter 53 of title 
        31, United States Code,, is the equivalent of, and creates the 
        same harm as, the smuggling of goods.
            (5) The arrest and prosecution of bulk cash smugglers are 
        important parts of law enforcement's effort to stop the 
        laundering of criminal proceeds, but the couriers who attempt 
        to smuggle the cash out of the United States are typically low-
        level employees of large criminal organizations, and thus are 
        easily replaced. Accordingly, only the confiscation of the 
        smuggled bulk cash can effectively break the cycle of criminal 
        activity of which the laundering of the bulk cash is a critical 
        part.
            (6) The current penalties for violations of the currency 
        reporting requirements are insufficient to provide a deterrent 
        to the laundering of criminal proceeds. In particular, in cases 
        where the only criminal violation under current law is a 
        reporting offense, the law does not adequately provide for the 
        confiscation of smuggled currency. In contrast, if the 
        smuggling of bulk cash were itself an offense, the cash could 
        be confiscated as the corpus delicti of the smuggling offense.
    (b) Purposes.--The purposes of this section are--
            (1) to make the act of smuggling bulk cash itself a 
        criminal offense;
            (2) to authorize forfeiture of any cash or instruments of 
        the smuggling offense;
            (3) to emphasize the seriousness of the act of bulk cash 
        smuggling; and
            (4) to prescribe guidelines for determining the amount of 
        property subject to such forfeiture in various situations.
    (c) Enactment of Bulk Cash Smuggling Offense.--Subchapter II of 
chapter 53 of title 31, United States Code, is amended by adding at the 
end the following:
``Sec. 5331. Bulk cash smuggling into or out of the United States
    ``(a) Criminal Offense.--
            ``(1) In general.--Whoever, with the intent to evade a 
        currency reporting requirement under section 5316, knowingly 
        conceals more than $10,000 in currency or other monetary 
        instruments on the person of such individual or in any 
        conveyance, article of luggage, merchandise, or other 
        container, and transports or transfers or attempts to transport 
        or transfer such currency or monetary instruments from a place 
        within the United States to a place outside of the United 
        States, or from a place outside the United States to a place 
        within the United States, shall be guilty of a currency 
        smuggling offense and subject to punishment pursuant to 
        subsection (b).
            ``(2) Concealment on person.--For purposes of this section, 
        the concealment of currency on the person of any individual 
        includes concealment in any article of clothing worn by the 
        individual or in any luggage, backpack, or other container worn 
        or carried by such individual.
    ``(b) Penalty.--
            ``(1) Term of imprisonment.--A person convicted of a 
        currency smuggling offense under subsection (a), or a 
        conspiracy to commit such offense, shall be imprisoned for not 
        more than 5 years.
            ``(2) Forfeiture.--In addition, the court, in imposing 
        sentence under paragraph (1), shall order that the defendant 
        forfeit to the United States, any property, real or personal, 
        involved in the offense, and any property traceable to such 
        property, subject to subsection (d) of this section.
            ``(3) Procedure.--The seizure, restraint, and forfeiture of 
        property under this section shall be governed by section 413 of 
        the Controlled Substances Act.
            ``(4) Personal money judgment.--If the property subject to 
        forfeiture under paragraph (2) is unavailable, and the 
        defendant has insufficient substitute property that may be 
        forfeited pursuant to section 413(p) of the Controlled 
        Substances Act, the court shall enter a personal money judgment 
        against the defendant for the amount that would be subject to 
        forfeiture.
    ``(c) Civil Forfeiture.--
            ``(1) In general.--Any property involved in a violation of 
        subsection (a), or a conspiracy to commit such violation, and 
        any property traceable to such violation or conspiracy, may be 
        seized and, subject to subsection (d) of this section, 
        forfeited to the United States.
            ``(2) Procedure.--The seizure and forfeiture shall be 
        governed by the procedures governing civil forfeitures in money 
        laundering cases pursuant to section 981(a)(1)(A) of title 18, 
        United States Code.
            ``(3) Treatment of certain property as involved in the 
        offense.--For purposes of this subsection and subsection (b), 
        any currency or other monetary instrument that is concealed or 
        intended to be concealed in violation of subsection (a) or a 
        conspiracy to commit such violation, any article, container, or 
        conveyance used, or intended to be used, to conceal or 
        transport the currency or other monetary instrument, and any 
        other property used, or intended to be used, to facilitate the 
        offense, shall be considered property involved in the 
        offense.''.
    (c) Clerical Amendment.--The table of sections for subchapter II of 
chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5330, the following new item:

``5331. Bulk cash smuggling into or out of the United States.''.

SEC. 102. FORFEITURE IN CURRENCY REPORTING CASES.

    (a) In General.--Subsection (c) of section 5317 of title 31, United 
States Code, is amended to read as follows:
    ``(c) Forfeiture.--
            ``(1) In general.--The court in imposing sentence for any 
        violation of section 5313, 5316, or 5324 of this title, or any 
        conspiracy to commit such violation, shall order the defendant 
        to forfeit all property, real or personal, involved in the 
        offense and any property traceable thereto.
            ``(2) Procedure.--Forfeitures under this subsection shall 
        be governed by the procedures established in section 413 of the 
        Controlled Substances Act and the guidelines established in 
        paragraph (4).
            ``(3) Civil forfeiture.--Any property involved in a 
        violation of section 5313, 5316, or 5324 of this title, or any 
        conspiracy to commit any such violation, and any property 
        traceable to any such violation or conspiracy, may be seized 
        and, subject to paragraph (4), forfeited to the United States 
        in accordance with the procedures governing civil forfeitures 
        in money laundering cases pursuant to section 981(a)(1)(A) of 
        title 18, United States Code.''.
    (b) Conforming Amendments.--
            (1) Section 981(a)(1)(A) of title 18, United States Code, 
        is amended by striking ``of section 5313(a) or 5324(a) of title 
        31, or''.
    (2) Section 982(a)(1) of title 18, United States Code, is amended 
by striking ``of section 5313(a), 5316, or 5324 of title 31, or''.

SEC. 103. ILLEGAL MONEY TRANSMITTING BUSINESSES.

    (a) Scienter Requirement for Section 1960 Violation.--Section 1960 
of title 18, United States Code, is amended to read as follows:
``Sec. 1960. Prohibition of unlicensed money transmitting businesses
    ``(a) Whoever knowingly conducts, controls, manages, supervises, 
directs, or owns all or part of an unlicensed money transmitting 
business, shall be fined in accordance with this title or imprisoned 
not more than 5 years, or both.
    ``(b) As used in this section--
            ``(1) the term `unlicensed money transmitting business' 
        means a money transmitting business which affects interstate or 
        foreign commerce in any manner or degree and--
                    ``(A) is operated without an appropriate money 
                transmitting license in a State where such operation is 
                punishable as a misdemeanor or a felony under State 
                law, whether or not the defendant knew that the 
                operation was required to be licensed or that the 
                operation was so punishable;
                    ``(B) fails to comply with the money transmitting 
                business registration requirements under section 5330 
                of title 31, United States Code, or regulations 
                prescribed under such section; or
                    ``(C) otherwise involves the transportation or 
                transmission of funds that are known to the defendant 
                to have been derived from a criminal offense or are 
                intended to be used to be used to promote or support 
                unlawful activity;
            ``(2) the term `money transmitting' includes transferring 
        funds on behalf of the public by any and all means including 
        but not limited to transfers within this country or to 
        locations abroad by wire, check, draft, facsimile, or courier; 
        and
            ``(3) the term `State' means any State of the United 
        States, the District of Columbia, the Northern Mariana Islands, 
        and any commonwealth, territory, or possession of the United 
        States.''.
    (b) Seizure of Illegally Transmitted Funds.--Section 981(a)(1)(A) 
of title 18, United States Code, is amended by striking ``or 1957'' and 
inserting ``, 1957 or 1960''.
    (c) Clerical Amendment.--The table of sections for chapter 95 of 
title 18, United States Code, is amended in the item relating to 
section 1960 by striking ``illegal'' and inserting ``unlicensed''.

SEC. 104. LONG-ARM JURISDICTION OVER FOREIGN MONEY LAUNDERERS.

    Section 1956(b) of title 18, United States Code, is amended--
            (1) by striking ``(b) Whoever'' and inserting ``(b)(1) 
        Whoever'';
            (2) by redesignating paragraphs (1) and (2) as 
        subparagraphs (A) and (B), respectively;
            (3) by striking ``subsection (a)(1) or (a)(3),'' and 
        inserting ``subsection (a)(1) or (a)(2) or section 1957,''; and
            (4) by adding at the end the following new paragraphs:
    ``(2) For purposes of adjudicating an action filed or enforcing a 
penalty ordered under this section, the district courts shall have 
jurisdiction over any foreign person, including any financial 
institution authorized under the laws of a foreign country, against 
whom the action is brought, if--
            ``(A) service of process upon such foreign person is made 
        under the Federal Rules of Civil Procedure or the laws of the 
        country where the foreign person is found; and
            ``(B) the foreign person--
                    ``(i) commits an offense under subsection (a) 
                involving a financial transaction that occurs in whole 
                or in part in the United States;
                    ``(ii) converts to such person's own use property 
                in which the United States has an ownership interest by 
                virtue of the entry of an order of forfeiture by a 
                court of the United States; or
                    ``(iii) is a financial institution that maintains a 
                correspondent bank account at a financial institution 
                in the United States.
    ``(3) The court may issue a pretrial restraining order or take any 
other action necessary to ensure that any bank account or other 
property held by the defendant in the United States is available to 
satisfy a judgment under this section.''.

SEC. 105. LAUNDERING MONEY THROUGH A FOREIGN BANK.

    Section 1956(c)(6) of title 18, United States Code, is amended to 
read as follows:
            ``(6) the term `financial institution' includes any 
        financial institution described in section 5312(a)(2) of title 
        31, United States Code, or the regulations promulgated 
        thereunder, as well as any foreign bank, as defined in 
        paragraph (7) of section 1(b) of the International Banking Act 
        of 1978 (12 U.S.C. 3101(7));''.

SEC. 106. SPECIFIED UNLAWFUL ACTIVITY FOR MONEY LAUNDERING.

    (a) In General.--Section 1956(c)(7) of title 18, United States 
Code, is amended--
            (1) in subparagraph (B)--
                    (A) by striking clause (ii) and inserting the 
                following new clause:
                            ``(ii) any act or acts constituting a crime 
                        of violence, as defined in section 16 of this 
                        title;''; and
                    (B) by inserting after clause (iii) the following 
                new clauses:
                            ``(iv) bribery of a public official, or the 
                        misappropriation, theft, or embezzlement of 
                        public funds by or for the benefit of a public 
                        official;
                            ``(v) smuggling or export control 
                        violations involving munitions listed in the 
                        United States Munitions List or technologies 
                        with military applications as defined in the 
                        Commerce Control List of the Export 
                        Administration Regulations; or
                            ``(vi) an offense with respect to which the 
                        United States would be obligated by a bilateral 
                        treaty either to extradite the alleged offender 
                        or to submit the case for prosecution, if the 
                        offender were found within the territory of the 
                        United States;''; and
            (2) in subparagraph (D)--
                    (A) by inserting ``section 541 (relating to goods 
                falsely classified),'' before ``section 542'';
                    (B) by inserting ``section 922(1) (relating to the 
                unlawful importation of firearms), section 924(n) 
                (relating to firearms trafficking),'' before ``section 
                956'';
                    (C) by inserting ``section 1030 (relating to 
                computer fraud and abuse),'' before ``1032''; and
                    (D) by inserting ``any felony violation of the 
                Foreign Agents Registration Act of 1938, as amended,'' 
                before ``or any felony violation of the Foreign Corrupt 
                Practices Act''.
    (b) Rule of Construction.--None of the changes or amendments made 
by the Financial Anti-Terrorism Act of 2001 shall expand the 
jurisdiction of any Federal or State court over any civil action or 
claim for monetary damages for the nonpayment of taxes or duties under 
the revenue laws of a foreign state, or any political subdivision 
thereof, except as such actions or claims are authorized by United 
States treaty that provides the United States and its political 
subdivisions with reciprocal rights to pursue such actions or claims in 
the courts of the foreign state and its political subdivisions.

SEC. 107. LAUNDERING THE PROCEEDS OF TERRORISM.

    Section 1956(c)(7)(D) of title 18, United States Code, is amended 
by inserting ``or 2339B'' after ``2339A''.

SEC. 108. PROCEEDS OF FOREIGN CRIMES.

    Section 981(a)(1)(B) of title 18, United States Code, is amended to 
read as follows:
            ``(B) Any property, real or personal, within the 
        jurisdiction of the United States, constituting, derived from, 
        or traceable to, any proceeds obtained directly or indirectly 
        from an offense against a foreign nation, or any property used 
        to facilitate such offense, if--
                    ``(i) the offense involves the manufacture, 
                importation, sale, or distribution of a controlled 
                substance (as such term is defined for the purposes of 
                the Controlled Substances Act), or any other conduct 
                described in section 1956(c)(7)(B),
                    ``(ii) the offense would be punishable within the 
                jurisdiction of the foreign nation by death or 
                imprisonment for a term exceeding one year, and
                    ``(iii) the offense would be punishable under the 
                laws of the United States by imprisonment for a term 
                exceeding one year if the act or activity constituting 
                the offense had occurred within the jurisdiction of the 
                United States.''.

SEC. 109. PENALTIES FOR VIOLATIONS OF GEOGRAPHIC TARGETING ORDERS AND 
              CERTAIN RECORD KEEPING REQUIREMENTS.

    (a) Civil Penalty for Violation of Targeting Order.--Section 
5321(a)(1) of title 31, United States Code, is amended--
            (1) by inserting ``or order issued'' after ``subchapter or 
        a regulation prescribed''; and
            (2) by inserting ``, or willfully violating a regulation 
        prescribed under section 21 of the Federal Deposit Insurance 
        Act or section 123 of Public Law 91-508,'' after ``sections 
        5314 and 5315)''.
    (b) Criminal Penalties for Violation of Targeting Order.--
    Section 5322 of title 31, United States Code, is amended--
            (1) in subsection (a)--
                    (A) by inserting ``or order issued'' after 
                ``willfully violating this subchapter or a regulation 
                prescribed''; and
                    (B) by inserting ``, or willfully violating a 
                regulation prescribed under section 21 of the Federal 
                Deposit Insurance Act or section 123 of Public Law 91-
                508,'' after ``under section 5315 or 5324)'';
            (2) in subsection (b)--
                    (A) by inserting ``or order issued'' after 
                ``willfully violating this subchapter or a regulation 
                prescribed''; and
                    (B) by inserting ``or willfully violating a 
                regulation prescribed under section 21 of the Federal 
                Deposit Insurance Act or section 123 of Public Law 91-
                508,'' after ``under section 5315 or 5324),'';
    (c) Structuring Transactions To Evade Targeting Order or Certain 
Record Keeping Requirements.--Section 5324(a) of title 31, United 
States Code, is amended--
            (1) by inserting a comma after ``shall'';
            (2) by striking ``section--'' and inserting ``section, the 
        reporting requirements imposed by any order issued under 
        section 5326, or the record keeping requirements imposed by any 
        regulation prescribed under section 21 of the Federal Deposit 
        Insurance Act or section 123 of Public Law 91-508--''; and
            (3) in paragraphs (1) and (2), by inserting ``, to file a 
        report required by any order issued under section 5326, or to 
        maintain a record required pursuant to any regulation 
        prescribed under section 21 of the Federal Deposit Insurance 
        Act or section 123 of Public Law 91-508'' after ``regulation 
        prescribed under any such section'' each place that term 
        appears.
    (d) Increase in Civil Penalties for Violation of Certain Record 
Keeping Requirements.--
            (1) Federal deposit insurance act.--Section 21(j)(1) of the 
        Federal Deposit Insurance Act (12 U.S.C. 1829b(j)(1)) is 
        amended by striking ``$10,000'' and inserting ``the greater 
        of--
                    ``(A) the amount (not to exceed $100,000) involved 
                in the transaction (if any) with respect to which the 
                violation occurred; or
                    ``(B) $25,000''.
            (2) Public law 91-508.--Section 125(a) of Public Law 91-508 
        (12 U.S.C. 1955(a)) is amended by striking ``$10,000'' and 
        inserting ``the greater of--
            ``(1) the amount (not to exceed $100,000) involved in the 
        transaction (if any) with respect to which the violation 
        occurred; or
            ``(2) $25,000''.
    (e) Criminal Penalties for Violation of Certain Record Keeping 
Requirements.--
            (1) Section 126.--Section 126 of Public Law 91-508 (12 
        U.S.C. 1956) is amended to read as follows:

``SEC. 126. CRIMINAL PENALTY.

    ``A person that willfully violates this chapter, section 21 of the 
Federal Deposit Insurance Act, or a regulation prescribed under this 
chapter or that section 21, shall be fined not more than $250,000, or 
imprisoned for not more than 5 years, or both.''.
            (2) Section 127.--Section 127 of Public Law 91-508 (12 
        U.S.C. 1957) is amended to read as follows:

``SEC. 127. ADDITIONAL CRIMINAL PENALTY IN CERTAIN CASES.

    ``A person that willfully violates this chapter, section 21 of the 
Federal Deposit Insurance Act, or a regulation prescribed under this 
chapter or that section 21, while violating another law of the United 
States or as part of a pattern of any illegal activity involving more 
than $100,000 in a 12-month period, shall be fined not more than 
$500,000, imprisoned for not more than 10 years, or both.''.

SEC. 110. EXCLUSION OF ALIENS INVOLVED IN MONEY LAUNDERING.

    (a) In General.--Section 212 of the Immigration and Nationality 
Act, as amended (8 U.S.C. 1182), is amended in subsection (a)(2)--
            (1) by redesignating subparagraphs (D), (E), (F), (G), and 
        (H) as subparagraphs (E), (F), (G), (H), and (I), respectively; 
        and
            (2) by inserting after subparagraph (C) the following new 
        subparagraph (D):
                    ``(D) Money laundering activities.--
                            ``(i) In general.--Any alien who the 
                        consular officer or the Attorney General knows 
                        or has reason to believe is or has been engaged 
                        in activities which if engaged in within the 
                        United States would constitute a violation of 
                        the money laundering provisions section 1956, 
                        1957, or 1960 of title 18, United States Code, 
                        or has knowingly assisted, abetted, or 
                        conspired or colluded with others in any such 
                        illicit activity is inadmissible.
                            ``(ii) Related individuals.--Any alien who 
                        the consular officer or the Attorney General 
                        knows or has reason to believe is the spouse, 
                        son, or daughter of an alien inadmissible under 
                        clause (i), has, within the previous 5 years, 
                        obtained any financial or other benefit from 
                        such illicit activity of that alien, and knew 
                        or reasonably should have known that the 
                        financial or other benefit was the product of 
                        such illicit activity, is inadmissible, except 
                        that the Attorney General may, in the full 
                        discretion of the Attorney General, waive the 
                        exclusion of the spouse, son, or daughter of an 
                        alien under this clause if the Attorney General 
                        determines that exceptional circumstances exist 
                        that justify such waiver.''.
    (b) Conforming amendment.--Section 212(h)(1)(A)(i) of the 
Immigration and Nationality Act, as amended (8 U.S.C. 1182), is amended 
by striking ``(D)(i) or (D)(ii)'' and inserting ``(E)(i) or (E)(ii)''.

SEC. 111. STANDING TO CONTEST FORFEITURE OF FUNDS DEPOSITED INTO 
              FOREIGN BANK THAT HAS A CORRESPONDENT ACCOUNT IN THE 
              UNITED STATES.

    Section 981 of title 18, United States Code, is amended by adding 
at the end the following new subsection:
    ``(k) Correspondent Bank Accounts.--
            ``(1) Treatment of accounts of correspondent bank in 
        domestic financial institutions.--
                    ``(A) In general.--For the purpose of a forfeiture 
                under this section or under the Controlled Substances 
                Act, if funds are deposited into a dollar-denominated 
                bank account in a foreign financial institution, and 
                that foreign financial institution has a correspondent 
                account with a financial institution in the United 
                States, the funds deposited into the foreign financial 
                institution (the respondent bank) shall be deemed to 
                have been deposited into the correspondent account in 
                the United States, and any restraining order, seizure 
                warrant, or arrest warrant in rem regarding such funds 
                may be served on the correspondent bank, and funds in 
                the correspondent account up to the value of the funds 
                deposited into the dollar-denominated account in the 
                foreign financial institution may be seized, arrested 
                or restrained.
                    ``(B) Authority to suspend.--The Attorney General, 
                in consultation with the Secretary, may suspend or 
                terminate a forfeiture under this section if the 
                Attorney General determines that a conflict of law 
                exists between the laws of the jurisdiction in which 
                the foreign bank is located and the laws of the United 
                States with respect to liabilities arising from the 
                restraint, seizure, or arrest of such funds, and that 
                such suspension or termination would be in the interest 
                of justice and would not harm the national interests of 
                the United States.
            ``(2) No requirement for government to trace funds.--If a 
        forfeiture action is brought against funds that are restrained, 
        seized, or arrested under paragraph (1), the Government shall 
        not be required to establish that such funds are directly 
        traceable to the funds that were deposited into the respondent 
        bank, nor shall it be necessary for the Government to rely on 
        the application of Section 984 of this title.
            ``(3) Claims brought by owner of the funds.--If a 
        forfeiture action is instituted against funds seized, arrested, 
        or restrained under paragraph (1), the owner of the funds may 
        contest the forfeiture by filing a claim pursuant to section 
        983.
            ``(4) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                    ``(A) Correspondent account.--The term 
                `correspondent account' has the meaning given to the 
                term `interbank account' in section 984(c)(2)(B).
                    ``(B) Owner.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), the term `owner'--
                                    ``(I) means the person who was the 
                                owner, as that term is defined in 
                                section 983(d)(6), of the funds that 
                                were deposited into the foreign bank at 
                                the time such funds were deposited; and
                                    ``(II) does not include either the 
                                foreign bank or any financial 
                                institution acting as an intermediary 
                                in the transfer of the funds into the 
                                interbank account.
                            ``(ii) Exception.--The foreign bank may be 
                        considered the `owner' of the funds (and no 
                        other person shall qualify as the owner of such 
                        funds) only if--
                                    ``(I) the basis for the forfeiture 
                                action is wrongdoing committed by the 
                                foreign bank; or
                                    ``(II) the foreign bank 
                                establishes, by a preponderance of the 
                                evidence, that prior to the restraint, 
                                seizure, or arrest of the funds, the 
                                foreign bank had discharged all or part 
                                of its obligation to the prior owner of 
                                the funds, in which case the foreign 
                                bank shall be deemed the owner of the 
                                funds to the extent of such discharged 
                                obligation.''.

SEC. 112. SUBPOENAS FOR RECORDS REGARDING FUNDS IN CORRESPONDENT BANK 
              ACCOUNTS.

    (a) In General.--Subchapter II of chapter 53 of title 31, United 
States Code, is amended by inserting after section 5331 (as added by 
section 101) the following new section:
``Sec. 5332. Subpoenas for records
    ``(a) Designation By Foreign Financial Institution of Agent.--Any 
foreign financial institution that has a correspondent bank account at 
a financial institution in the United States shall designate a person 
residing in the United States as a person authorized to accept a 
subpoena for bank records or other legal process served on the foreign 
financial institution.
    ``(b) Maintenance of Records By Domestic Financial Institution.--
            ``(1) In general.--Any domestic financial institution that 
        maintains a correspondent bank account for a foreign financial 
        institution shall maintain records regarding the names and 
        addresses of the owners of the foreign financial institution, 
        and the name and address of the person who may be served with a 
        subpoena for records regarding any funds transferred to or from 
        the correspondent account.
            ``(2) Provision to law enforcement agency.--A domestic 
        financial institution shall provide names and addresses 
        maintained under paragraph (1) to a Government authority (as 
        defined in section 1101(3) of the Right to Financial Privacy 
        Act of 1978) within 7 days of the receipt of a request, in 
        writing, for such records.
    ``(c) Administrative Subpoena.--
            ``(1) In general.--The Attorney General and the Secretary 
        of the Treasury may each issue an administrative subpoena for 
        records relating to the deposit of any funds into a dollar-
        denominated account in a foreign financial institution that 
        maintains a correspondent account at a domestic financial 
        institution.
            ``(2) Manner of issuance.--Any subpoena issued by the 
        Attorney General or the Secretary of the Treasury under 
        paragraph (1) shall be issued in the manner described in 
        section 3486 of title 18, and may be served on the 
        representative designated by the foreign financial institution 
        pursuant to subsection (a) to accept legal process in the 
        United States, or in a foreign country pursuant to any mutual 
        legal assistance treaty, multilateral agreement, or other 
        request for international law enforcement assistance.
    ``(d) Correspondent Account Defined.--For purposes of this section, 
the term `correspondent account' has the same meaning as the term 
`interbank account' as such term is defined in section 984(c)(2)(B) of 
title 18, United States Code.''.
    (b) Clerical amendments.--The table of sections for subchapter II 
of chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5331 (as added by section 101) the 
following new item:

``5332. Subpoenas for records.''.
    (c) Effective Date.--Section 5332(a) of title 31, United States 
Code, (as added by subsection (a) of this section shall apply after the 
end of the 30-day period beginning on the date of the enactment of this 
Act.
    (d) Requests for Records.--Section 3486(a)(1)(A)(i) of title 18, 
United States Code, is amended by striking ``; or (II) a Federal 
offense involving the sexual exploitation or abuse of children,'' and 
inserting ``, (II) a Federal offense involving the sexual exploitation 
or abuse of children, or (III) a money laundering offense in violation 
of section 1956, 1957 or 1960 of this title,''.

SEC. 113. AUTHORITY TO ORDER CONVICTED CRIMINAL TO RETURN PROPERTY 
              LOCATED ABROAD.

    (a) Forfeiture of Substitute Property.--Section 413(p) of the 
Controlled Substances Act (21 U.S.C. 853) is amended to read as 
follows:
    ``(p) Forfeiture of Substitute Property.--
            ``(1) In general.--Paragraph (2) of this subsection shall 
        apply, if any property described in subsection (a), as a result 
        of any act or omission of the defendant--
                    ``(A) cannot be located upon the exercise of due 
                diligence;
                    ``(B) has been transferred or sold to, or deposited 
                with, a third party;
                    ``(C) has been placed beyond the jurisdiction of 
                the court;
                    ``(D) has been substantially diminished in value; 
                or
                    ``(E) has been commingled with other property which 
                cannot be divided without difficulty.
            ``(2) Substitute property.--In any case described in any of 
        subparagraphs (A) through (E) of paragraph (1), the court shall 
        order the forfeiture of any other property of the defendant, up 
        to the value of any property described in subparagraphs (A) 
        through (E) of paragraph (1), as applicable.
            ``(3) Return of property to jurisdiction.--In the case of 
        property described in paragraph (1)(C), the court may, in 
        addition to any other action authorized by this subsection, 
        order the defendant to return the property to the jurisdiction 
        of the court so that the property may be seized and 
        forfeited.''.
    (b) Protective Orders.--Section 413(e) of the Controlled Substances 
Act (21 U.S.C. 853(e)) is amended by adding at the end the following:
    ``(4) Order To Repatriate and Deposit.--
            ``(A) In general.--Pursuant to its authority to enter a 
        pretrial restraining order under this section, the court may 
        order a defendant to repatriate any property that may be seized 
        and forfeited, and to deposit that property pending trial in 
        the registry of the court, or with the United States Marshals 
        Service or the Secretary of the Treasury, in an interest-
        bearing account, if appropriate.
            ``(B) Failure to comply.--Failure to comply with an order 
        under this subsection, or an order to repatriate property under 
        subsection (p), shall be punishable as a civil or criminal 
        contempt of court, and may also result in an enhancement of the 
        sentence of the defendant under the obstruction of justice 
        provision of the Federal Sentencing Guidelines.''.

SEC. 114. CORPORATION REPRESENTED BY A FUGITIVE.

    Section 2466 of title 28, United States Code, is amended by 
designating the present matter as subsection (a), and adding at the end 
the following:
    ``(b) Subsection (a) may be applied to a claim filed by a 
corporation if any majority shareholder, or individual filing the claim 
on behalf of the corporation is a person to whom subsection (a) 
applies.''.

SEC. 115. ENFORCEMENT OF FOREIGN JUDGMENTS.

    Section 2467 of title 28, United States Code, is amended--
            (1) in subsection (d), by inserting after paragraph (2) the 
        following new paragraph:
            ``(3) Preservation of property.--To preserve the 
        availability of property subject to a foreign forfeiture or 
        confiscation judgment, the Government may apply for, and the 
        court may issue, a restraining order pursuant to section 983(j) 
        of title 18, United States Code, at any time before or after an 
        application is filed pursuant to subsection (c)(1). The court, 
        in issuing the restraining order--
                    ``(A) may rely on information set forth in an 
                affidavit describing the nature of the proceeding or 
                investigation underway in the foreign country, and 
                setting forth a reasonable basis to believe that the 
                property to be restrained will be named in a judgment 
                of forfeiture at the conclusion of such proceeding; or
                    ``(B) may register and enforce a restraining order 
                that has been issued by a court of competent 
                jurisdiction in the foreign country and certified by 
                the Attorney General pursuant to subsection (b)(2).
        No person may object to the restraining order on any ground 
        that is the subject of parallel litigation involving the same 
        property that is pending in a foreign court.'';
            (2) in subsection (b)(1)(C), by striking ``establishing 
        that the defendant received notice of the proceedings in 
        sufficient time to enable the defendant'' and inserting 
        ``establishing that the foreign nation took steps, in 
        accordance with the principles of due process, to give notice 
        of the proceedings to all persons with an interest in the 
        property in sufficient time to enable such persons'';
            (3) in subsection (d)(1)(D), by striking ``the defendant in 
        the proceedings in the foreign court did not receive notice'' 
        and inserting ``the foreign nation did not take steps, in 
        accordance with the principles of due process, to give notice 
        of the proceedings to a person with an interest in the 
        property''; and
            (4) in subsection (a)(2)(A), by inserting ``, any violation 
        of foreign law that would constitute a violation of an offense 
        for which property could be forfeited under Federal law if the 
        offense were committed in the United States'' after ``United 
        Nations Convention''.

SEC. 116. REPORTING PROVISIONS AND ANTI-TERRORIST ACTIVITIES OF UNITED 
              STATES INTELLIGENCE AGENCIES.

    (a) Amendment Relating to the Purposes of Chapter 53 of Title 31, 
United States Code.--Section 5311 of title 31, United States Code, is 
amended by inserting before the period at the end the following: ``, or 
in the conduct of intelligence or counterintelligence activities, 
including analysis, to protect against international terrorism''.
    (b) Amendment Relating to Reporting of Suspicious Activities.--
Section 5318(g)(4)(B) of title 31, United States Code, is amended by 
striking ``or supervisory agency'' and inserting ``, supervisory 
agency, or United States intelligence agency for use in the conduct of 
intelligence or counterintelligence activities, including analysis, to 
protect against international terrorism''.
    (c) Amendment Relating to Availability of Reports.--Section 5319 of 
title 31, United States Code, is amended to read as follows:
``Sec. 5319. Availability of reports
    ``The Secretary of the Treasury shall make information in a report 
filed under this subchapter available to an agency, including any State 
financial institutions supervisory agency, United States intelligence 
agency or self-regulatory organization registered with the Securities 
and Exchange Commission or the Commodity Futures Trading Commission, 
upon request of the head of the agency or organization. The report 
shall be available for a purpose that is consistent with this 
subchapter. The Secretary may only require reports on the use of such 
information by any State financial institutions supervisory agency for 
other than supervisory purposes or by United States intelligence 
agencies. However, a report and records of reports are exempt from 
disclosure under section 552 of title 5.''.
    (d) Amendment Relating to the Retention of Records by Insured 
Depository Institutions.--Section 21(a) of the Federal Deposit 
Insurance Act (12 U.S.C. 1829b(a)) is amended--
            (1) in paragraph (1), by inserting ``, or in the conduct of 
        intelligence or counterintelligence activities, including 
        analysis, to protect against international terrorism'' after 
        ``proceedings''; and
            (2) in paragraph (2), by inserting ``, or in the conduct of 
        intelligence or counterintelligence activities, including 
        analysis, to protect against international terrorism'' before 
        the period at the end.
    (e) Amendment Relating to the Retention of Records by Uninsured 
Institutions.--Section 123(a) of Public Law 91-508 (12 U.S.C. 1953(a)) 
is amended by inserting ``, or in the conduct of intelligence or 
counterintelligence activities, including analysis, to protect against 
international terrorism'' after ``proceedings''.
    (f) Amendments to the Right to Financial Privacy Act.--The Right to 
Financial Privacy Act of 1978 is amended--
            (1) in section 1112(a) (12 U.S.C. 3412(a)), by inserting 
        ``, or intelligence or counterintelligence activity, 
        investigation or analysis related to international terrorism'' 
        after ``legitimate law enforcement inquiry'';
            (2) in section 1114(a)(1) (12 U.S.C. 3414(a)(1))--
                    (A) in subparagraph (A), by striking ``or'' at the 
                end;
                    (B) in subparagraph (B), by striking the period at 
                the end and inserting ``; or''; and
                    (C) by adding at the end the following:
                    ``(C) a Government authority authorized to conduct 
                investigations of, or intelligence or 
                counterintelligence analyses related to, international 
                terrorism for the purpose of conducting such 
                investigations or analyses.''; and
            (3) in section 1120(a)(2) (12 U.S.C. 3420(a)(2)), by 
        inserting ``, or for a purpose authorized by section 1112(a)'' 
        before the semicolon at the end.
    (g) Amendment to the Fair Credit Reporting Act.--
            (1) In general.--The Fair Credit Reporting Act (15 U.S.C. 
        1681 et seq.) is amended--
                    (A) by redesignating the second of the 2 sections 
                designated as section 624 (15 U.S.C. 1681u) (relating 
                to disclosure to FBI for counterintelligence purposes) 
                as section 625; and
                    (B) by adding at the end the following new section:
``Sec. 626. Disclosures to governmental agencies for counterterrorism 
              purposes
    ``(a) Disclosure.--Notwithstanding section 604 or any other 
provision of this title, a consumer reporting agency shall furnish a 
consumer report of a consumer and all other information in a consumer's 
file to a government agency authorized to conduct investigations of, or 
intelligence or counterintelligence activities or analysis related to, 
international terrorism when presented with a written certification by 
such government agency that such information is necessary for the 
agency's conduct or such investigation, activity or analysis.
    ``(b)  Form of Certification.--The certification described in 
subsection (a) shall be signed by a supervisory official designated by 
the head of a Federal agency or an officer of a Federal agency whose 
appointment to office is required to be made by the President, by and 
with the advice and consent of the Senate.
    ``(c) Confidentiality.--No consumer reporting agency, or officer, 
employee, or agent of such consumer reporting agency, shall disclose to 
any person, or specify in any consumer report, that a government agency 
has sought or obtained access to information under subsection (a).
    ``(d) Rule of Construction.--Nothing in section 625 shall be 
construed to limit the authority of the Director of the Federal Bureau 
of Investigation under this section.
    ``(e) Safe Harbor.--Notwithstanding any other provision of this 
subchapter, any consumer reporting agency or agent or employee thereof 
making disclosure of consumer reports or other information pursuant to 
this section in good-faith reliance upon a certification of a 
governmental agency pursuant to the provisions of this section shall 
not be liable to any person for such disclosure under this subchapter, 
the constitution of any State, or any law or regulation of any State or 
any political subdivision of any State.''.
            (2) Clerical amendments.--The table of sections for the 
        Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) is amended--
                    (A) by redesignating the second of the 2 items 
                designated as section 624 as section 625; and
                    (B) by inserting after the item relating to section 
                625 (as so redesignated) the following new item:

``626. Disclosures to governmental agencies for counterterrorism 
                            purposes.''.
    (h) Application of Amendments.--The amendments made by this section 
shall apply with respect to reports filed or records maintained on, 
before, or after the date of the enactment of this Act.

SEC. 117. FINANCIAL CRIMES ENFORCEMENT NETWORK.

    (a) In General.--Subchapter I of chapter 3 of title 31, United 
States Code, is amended--
            (1) by redesignating section 310 as section 311; and
            (2) by inserting after section 309 the following new 
        section:
``Sec. 310. Financial Crimes Enforcement Network
    ``(a) In General.--The Financial Crimes Enforcement Network 
established by order of the Secretary of the Treasury (Treasury Order 
Numbered 105-08) on April 25, 1990, shall be a bureau in the Department 
of the Treasury.
    ``(b) Director.--
            ``(1) Appointment.--The head of the Financial Crimes 
        Enforcement Network shall be the Director who shall be 
        appointed by the Secretary of the Treasury.
            ``(2) Duties and powers.--The duties and powers of the 
        Director are as follows:
                    ``(A) Advise and make recommendations on matters 
                relating to financial intelligence, financial criminal 
                activities, and other financial activities to the Under 
                Secretary for Enforcement.
                    ``(B) Maintain a government-wide data access 
                service, with access, in accordance with applicable 
                legal requirements, to the following:
                            ``(i) Information collected by the 
                        Department of the Treasury, including report 
                        information filed under subchapters II and III 
                        of chapter 53 of this title (such as reports on 
                        cash transactions, foreign financial agency 
                        transactions and relationships, foreign 
                        currency transactions, exporting and importing 
                        monetary instruments, and suspicious 
                        activities), chapter 2 of title I of Public Law 
                        91-508, and section 21 of the Federal Deposit 
                        Insurance Act.
                            ``(ii) Information regarding national and 
                        international currency flows.
                            ``(iii) Other records and data maintained 
                        by other Federal, State, local, and foreign 
                        agencies, including financial and other records 
                        developed in specific cases.
                            ``(iv) Other privately and publicly 
                        available information.
                    ``(C) Analyze and disseminate the available data in 
                accordance with applicable legal requirements and 
                policies and guidelines established by the Secretary of 
                the Treasury and the Under Secretary for Enforcement 
                to--
                            ``(i) identify possible criminal activity 
                        to appropriate Federal, State, local, and 
                        foreign law enforcement agencies;
                            ``(ii) support ongoing criminal financial 
                        investigations and prosecutions and related 
                        proceedings, including civil and criminal tax 
                        and forfeiture proceedings;
                            ``(iii) identify possible instances of 
                        noncompliance with subchapters II and III of 
                        chapter 53 of this title, chapter 2 of title I 
                        of Public Law 91-508, and section 21 of the 
                        Federal Deposit Insurance Act to Federal 
                        agencies with statutory responsibility for 
                        enforcing compliance with such provisions and 
                        other appropriate Federal regulatory agencies;
                            ``(iv) evaluate and recommend possible uses 
                        of special currency reporting requirements 
                        under section 5326;
                            ``(v) determine emerging trends and methods 
                        in money laundering and other financial crimes;
                            ``(vi) support the conduct of intelligence 
                        or counterintelligence activities, including 
                        analysis, to protect against international 
                        terrorism; and
                            ``(vii) support government initiatives 
                        against money laundering.
                    ``(D) Establish and maintain a financial crimes 
                communications center to furnish law enforcement 
                authorities with intelligence information related to 
                emerging or ongoing investigations and undercover 
                operations.
                    ``(E) Furnish research, analytical, and 
                informational services to financial institutions, 
                appropriate Federal regulatory agencies with regard to 
                financial institutions, and appropriate Federal, State, 
                local, and foreign law enforcement authorities, in 
                accordance with policies and guidelines established by 
                the Secretary of the Treasury or the Under Secretary of 
                the Treasury for Enforcement, in the interest of 
                detection, prevention, and prosecution of terrorism, 
                organized crime, money laundering, and other financial 
                crimes.
                    ``(F) Establish and maintain a special unit 
                dedicated to assisting Federal, State, local, and 
                foreign law enforcement and regulatory authorities in 
                combatting the use of informal, nonbank networks and 
                payment and barter system mechanisms that permit the 
                transfer of funds or the equivalent of funds without 
                records and without compliance with criminal and tax 
                laws.
                    ``(G) Provide computer and data support and data 
                analysis to the Secretary of the Treasury for tracking 
                and controlling foreign assets.
                    ``(H) Coordinate with financial intelligence units 
                in other countries on anti-terrorism and anti-money 
                laundering initiatives, and similar efforts.
                    ``(I) Administer the requirements of subchapters II 
                and III of chapter 53 of this title, chapter 2 of title 
                I of Public Law 91-508, and section 21 of the Federal 
                Deposit Insurance Act, to the extent delegated such 
                authority by the Secretary of the Treasury.
                    ``(J) Such other duties and powers as the Secretary 
                of the Treasury may delegate or prescribe.
    ``(c) Requirements Relating to Maintenance and Use of Data Banks.--
The Secretary of the Treasury shall establish and maintain operating 
procedures with respect to the government-wide data access service and 
the financial crimes communications center maintained by the Financial 
Crimes Enforcement Network which provide--
            ``(1) for the coordinated and efficient transmittal of 
        information to, entry of information into, and withdrawal of 
        information from, the data maintenance system maintained by the 
        Network, including--
                    ``(A) the submission of reports through the 
                Internet or other secure network, whenever possible;
                    ``(B) the cataloguing of information in a manner 
                that facilitates rapid retrieval by law enforcement 
                personnel of meaningful data; and
                    ``(C) a procedure that provides for a prompt 
                initial review of suspicious activity reports and other 
                reports, or such other means as the Secretary may 
                provide, to identify information that warrants 
                immediate action; and
            ``(2) in accordance with section 552a of title 5 and the 
        Right to Financial Privacy Act of 1978, appropriate standards 
        and guidelines for determining--
                    ``(A) who is to be given access to the information 
                maintained by the Network;
                    ``(B) what limits are to be imposed on the use of 
                such information; and
                    ``(C) how information about activities or 
                relationships which involve or are closely associated 
                with the exercise of constitutional rights is to be 
                screened out of the data maintenance system.
    ``(d) Authorization of Appropriations.--There are authorized to be 
appropriated for the Financial Crimes Enforcement Network such sums as 
may be necessary for fiscal years 2002, 2003, 2004, and 2005.''.
    (b) Compliance With Existing Reports Compliance.--The Secretary of 
the Treasury shall study methods for improving compliance with the 
reporting requirements established in section 5314 of title 31, United 
States Code, and shall submit a report on such study to the Congress by 
the end of the 6-month period beginning on the date of the enactment of 
this Act and each 1-year period thereafter. The initial report shall 
include historical data on compliance with such reporting requirements.
    (c) Clerical Amendment.--The table of sections for subchapter I of 
chapter 3 of title 31, United States Code, is amended--
            (1) by redesignating the item relating to section 310 as 
        section 311; and
            (2) by inserting after the item relating to section 309 the 
        following new item:

``310. Financial Crimes Enforcement Network''.

SEC. 118. PROHIBITION ON FALSE STATEMENTS TO FINANCIAL INSTITUTIONS 
              CONCERNING THE IDENTITY OF A CUSTOMER.

    (a) In General.--Chapter 47 of title 18, United States Code, is 
amended by inserting after section 1007 the following:
``Sec. 1008. False statements concerning the identity of customers of 
              financial institutions
    ``(a) In General.--Whoever, in connection with information 
submitted to or requested by a financial institution, knowingly in any 
manner--
            ``(1) falsifies, conceals, or covers up, or attempts to 
        falsify, conceal, or cover up, the identity of any person in 
        connection with any transaction with a financial institution;
            ``(2) makes, or attempts to make, any materially false, 
        fraudulent, or fictitious statement or representation of the 
        identity of any person in connection with a transaction with a 
        financial institution;
            ``(3) makes or uses, or attempts to make or use, any false 
        writing or document knowing the same to contain any materially 
        false, fictitious, or fraudulent statement or entry concerning 
        the identity of any person in connection with a transaction 
        with a financial institution; or
            ``(4) uses or presents, or attempts to use or present, in 
        connection with a transaction with a financial institution, an 
        identification document or means of identification the 
        possession of which is a violation of section 1028;
shall be fined under this title, imprisoned not more than 5 years, or 
both.
    ``(b) Definitions.--In this section, the following definitions 
shall apply:
            ``(1) Financial institution.--The term `financial 
        institution'--
                    ``(A) has the same meaning as in section 20; and
                    ``(B) in addition, has the same meaning as in 
                section 5312(a)(2) of title 31, United States Code.
            ``(2) Identification document.--The term `identification 
        document' has the same meaning as in section 1028(d).
            ``(3) Means of identification.--The term `means of 
        identification' has the same meaning as in section 1028(d).''.
    (b) Technical and Conforming Amendments.--
            (1) Title 18, united states code.--Section 1956(c)(7)(D) of 
        title 18, United States Code, is amended by striking ``1014 
        (relating to fraudulent loan'' and inserting ``section 1008 
        (relating to false statements concerning the identity of 
        customers of financial institutions), section 1014 (relating to 
        fraudulent loan''.
            (2) Table of sections.--The table of sections for chapter 
        47 of title 18, United States Code, is amended by inserting 
        after the item relating to section 1007 the following:

``1008. False statements concerning the identity of customers of 
                            financial institutions.''.

SEC. 119. VERIFICATION OF IDENTIFICATION.

    (a) In General.--Section 5318 of title 31, United States Code, is 
amended by adding at the end the following new subsection:
    ``(i) Identification and Verification of Accountholders.--
            ``(1) In general.--Subject to the requirements of this 
        subsection, the Secretary of the Treasury shall prescribe 
        regulations setting forth the minimum standards regarding 
        customer identification that shall apply in connection with the 
        opening of an account at a financial institution.
            ``(2) Minimum requirements.--The regulations shall, at a 
        minimum, require financial institutions to implement procedures 
        for--
                    ``(A) verifying the identity of any person seeking 
                to open an account to the extent reasonable and 
                practicable;
                    ``(B) maintaining records of the information used 
                to verify a person's identity, including name, address, 
                and other identifying information;
                    ``(C) consulting lists of known or suspected 
                terrorists or terrorist organizations provided to the 
                financial institution by any government agency to 
                determine whether a person seeking to open an account 
                appears on any such list.
            ``(3) Factors to be considered.--In prescribing regulations 
        under this subsection, the Secretary shall take into 
        consideration the various types of accounts maintained by 
        various types of financial institutions, the various methods of 
        opening accounts, and the various types of identifying 
        information available.
            ``(4) Certain financial institutions.--In the case of any 
        financial institution the business of which is engaging in 
        financial activities described in section 4(k) of the Bank 
        Holding Company Act of 1956 (including financial activities 
        subject to the jurisdiction of the Commodity Futures Trading 
        Commission), the regulations prescribed by the Secretary under 
        paragraph (1) shall be prescribed jointly with each Federal 
        functional regulator (as defined in section 509 of the Gramm-
        Leach-Bliley Act, including the Commodity Futures Trading 
        Commission) appropriate for such financial institution.
            ``(5) Exemptions.--The Secretary of the Treasury (and, in 
        the case of any financial institution described in paragraph 
        (4), any Federal agency described in such paragraph) may, by 
        regulation or order, exempt any financial institution or type 
        of account from the requirements of any regulation prescribed 
        under this subsection in accordance with such standards and 
        procedures as the Secretary may prescribe.
            ``(6) Effective date.--Final regulations prescribed under 
        this subsection shall take effect before the end of the 1-year 
        period beginning on the date of the enactment of the Financial 
        Anti-Terrorism Act of 2001.''.
    (b) Study and Report Required.--Within 6 months after the date of 
the enactment of this Act, the Secretary of the Treasury, in 
consultation with the Federal functional regulators (as defined in 
section 509 of the Gramm-Leach-Bliley Act) and other appropriate 
Government agencies, shall submit a report to the Congress containing 
recommendations for--
            (1) determining the most timely and effective way to 
        require foreign nationals to provide domestic financial 
        institutions and agencies with appropriate and accurate 
        information, comparable to that which is required of United 
        States nationals, concerning their identity, address, and other 
        related information necessary to enable such institutions and 
        agencies to comply with the requirements of this section;
            (2) requiring foreign nationals to apply for and obtain, 
        before opening an account with a domestic financial 
        institution, an identification number which would function 
        similarly to a Social Security number or tax identification 
        number; and
            (3) establishing a system for domestic financial 
        institutions and agencies to review information maintained by 
        relevant Government agencies for purposes of verifying the 
        identities of foreign nationals seeking to open accounts at 
        those institutions and agencies.

SEC. 120. CONSIDERATION OF ANTI-MONEY LAUNDERING RECORD.

    (a) Bank Holding Company Act of 1956.--
            (1) In general.--Section 3(c) of the Bank Holding Company 
        Act of 1956 (12 U.S.C. 1842(c)) is amended by adding at the end 
        the following new paragraph:
            ``(6) Money laundering.--In every case the Board shall take 
        into consideration the effectiveness of the company or 
        companies in combatting and preventing money laundering 
        activities, including in overseas branches.''.
    (2) Scope of application.--The amendment made by paragraph (1) 
shall apply with respect to any application submitted to the Board of 
Governors of the Federal Reserve System under section 3 of the Bank 
Holding Company Act of 1956 after December 31, 2000, which has not been 
approved by the Board before the date of the enactment of this Act.
    (b) Mergers Subject to Review Under Federal Deposit Insurance 
Act.--
            (1) In general.--Section 18(c) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1828(c)) is amended--
                    (A) by redesignating paragraph (11) as paragraph 
                (12); and
                    (B) by inserting after paragraph (10), the 
                following new paragraph:
            ``(11) Money laundering.--In every case, the responsible 
        agency shall take into consideration the effectiveness of any 
        insured depository institution involved in the proposed merger 
        transaction in combatting and preventing money laundering 
        activities, including in overseas branches.''.
    (2) Scope of application.--The amendment made by paragraph (1) 
shall apply with respect to any application submitted to the 
responsible agency under section 18(c) of the Federal Deposit Insurance 
Act after December 31, 2000, which has not been approved by all 
appropriate responsible agencies before the date of the enactment of 
this Act.

SEC. 121. REPORTING OF SUSPICIOUS ACTIVITIES BY INFORMAL UNDERGROUND 
              BANKING SYSTEMS, SUCH AS HAWALAS.

    (a) Definition for Subchapter.--Subparagraph (R) of section 
5312(a)(2) of title 31, United States Code, is amended to read as 
follows:
                    ``(R) a licensed sender of money or any other 
                person who engages as a business in the transmission of 
                funds, including through an informal value transfer 
                banking system or network of people facilitating the 
                transfer of value domestically or internationally 
                outside of the conventional financial institutions 
                system;''.
    (b) Money Transmitting Business.--Section 5330(d)(1)(A) of title 
31, United States Code, is amended by inserting before the semicolon 
the following: ``or any other person who engages as a business in the 
transmission of funds, including through an informal value transfer 
banking system or network of people facilitating the transfer of value 
domestically or internationally outside of the conventional financial 
institutions system''.
    (c) Applicability of Rules.--Section 5318 of title 31, United 
States Code, as amended by this Act, is amended by adding at the end 
the following:
    ``(l) Applicability of Rules.--Any rules prescribed pursuant to the 
authority contained in section 21 of the Federal Deposit Insurance Act 
shall apply, in addition to any other financial institution to which 
such rules apply, to any person that engages as a business in the 
transmission of funds, including through an informal value transfer 
banking system or network of people facilitating the transfer of value 
domestically or internationally outside of the conventional financial 
institutions system.''.
    (d) Report.--Not later than 1 year after the date of enactment of 
this Act, the Secretary of the Treasury shall report to Congress on the 
need for any additional legislation relating to--
            (1) informal value transfer banking systems or networks of 
        people facilitating the transfer of value domestically or 
        internationally outside of the conventional financial 
        institutions system;
            (2) anti-money laundering controls; and
            (3) regulatory controls relating to underground money 
        movement and banking systems, such as the system referred to as 
        ``hawala'', including whether the threshold for the filing of 
        suspicious activity reports under section 5318(g) of title 31, 
        United States Code should be lowered in the case of such 
        systems.

SEC. 122. UNIFORM PROTECTION AUTHORITY FOR FEDERAL RESERVE FACILITIES.

    Section 11 of the Federal Reserve Act (12 U.S.C. 248) is amended by 
adding at the end the following:
    ``(q) Uniform Protection Authority for Federal Reserve 
Facilities.--
            ``(1) Notwithstanding any other provision of law, to 
        authorize personnel to act as law enforcement officers to 
        protect and safeguard the premises, grounds, property, 
        personnel, including members of the Board, of the Board, or any 
        Federal reserve bank, and operations conducted by or on behalf 
        of the Board or a reserve bank.
            ``(2) The Board may, subject to the regulations prescribed 
        under paragraph (5), delegate authority to a Federal reserve 
        bank to authorize personnel to act as law enforcement officers 
        to protect and safeguard the bank's premises, grounds, 
        property, personnel, and operations conducted by or on behalf 
        of the bank.
            ``(3) Law enforcement officers designated or authorized by 
        the Board or a reserve bank under paragraph (1) or (2) are 
        authorized while on duty to carry firearms and make arrests 
        without warrants for any offense against the United States 
        committed in their presence, or for any felony cognizable under 
        the laws of the United States committed or being committed 
        within the buildings and grounds of the Board or a reserve bank 
        if they have reasonable grounds to believe that the person to 
        be arrested has committed or is committing such a felony. Such 
        officers shall have access to law enforcement information that 
        may be necessary for the protection of the property or 
        personnel of the Board or a reserve bank.
            ``(4) For purposes of this subsection, the term `law 
        enforcement officers' means personnel who have successfully 
        completed law enforcement training and are authorized to carry 
        firearms and make arrests pursuant to this subsection.
            ``(5) The law enforcement authorities provided for in this 
        subsection may be exercised only pursuant to regulations 
        prescribed by the Board and approved by the Attorney 
        General.''.

SEC. 123. REPORTS RELATING TO COINS AND CURRENCY RECEIVED IN 
              NONFINANCIAL TRADE OR BUSINESS.

    (a) Reports Required.--Subchapter II of chapter 53 of title 31, 
United States Code, is amended by inserting after section 5332 (as 
added by section 112 of this title) the following new section:

``SEC. 5333. REPORTS RELATING TO COINS AND CURRENCY RECEIVED IN 
              NONFINANCIAL TRADE OR BUSINESS.

    ``(a) Coin and Currency Receipts of More Than $10,000.--Any 
person--
            ``(1) who is engaged in a trade or business; and
            ``(2) who, in the course of such trade or business, 
        receives more than $10,000 in coins or currency in 1 
        transaction (or 2 or more related transactions),
shall file a report described in subsection (b) with respect to such 
transaction (or related transactions) with the Financial Crimes 
Enforcement Network at such time and in such manner as the Secretary 
may, by regulation, prescribe.
    ``(b) Form and Manner of Reports.--A report is described in this 
subsection if such report--
            ``(1) is in such form as the Secretary may prescribe;
            ``(2) contains--
                    ``(A) the name and address, and such other 
                identification information as the Secretary may 
                require, of the person from whom the coins or currency 
                was received;
                    ``(B) the amount of coins or currency received;
                    ``(C) the date and nature of the transaction; and
                    ``(D) such other information, including the 
                identification of the person filing the report, as the 
                Secretary may prescribe.
    ``(c) Exceptions.--
            ``(1) Amounts received by financial institutions.--
        Subsection (a) shall not apply to amounts received in a 
        transaction reported under section 5313 and regulations 
        prescribed under such section.
            ``(2) Transactions occurring outside the united states.--
        Except to the extent provided in regulations prescribed by the 
        Secretary, subsection (a) shall not apply to any transaction if 
        the entire transaction occurs outside the United States.
    ``(d) Currency Includes Foreign Currency and Certain Monetary 
Instruments.--
            ``(1) In general.--For purposes of this section, the term 
        `currency' includes--
                    ``(A) foreign currency; and
                    ``(B) to the extent provided in regulations 
                prescribed by the Secretary, any monetary instrument 
                (whether or not in bearer form) with a face amount of 
                not more than $10,000.
            ``(2) Scope of application.--Paragraph (1)(B) shall not 
        apply to any check drawn on the account of the writer in a 
        financial institution referred to in subparagraph (A), (B), 
        (C), (D), (E), (F), (G), (J), (K), (R), or (S) of section 
        5312(a)(2).''.
    (b) Prohibition on Structuring Transactions.--
            (1) In general.--Section 5324 of title 31, United States 
        Code, is amended--
                    (A) by redesignating subsections (b) and (c) as 
                subsections (c) and (d), respectively; and
                    (B) by inserting after subsection (a) the following 
                new subsection:
    ``(b) Domestic Coin and Currency Transactions Involving 
Nonfinancial Trades or Businesses.--No person shall for the purpose of 
evading the report requirements of section 5333 or any regulation 
prescribed under such section--
            ``(1) cause or attempt to cause a nonfinancial trade or 
        business to fail to file a report required under section 5333 
        or any regulation prescribed under such section;
            ``(2) cause or attempt to cause a nonfinancial trade or 
        business to file a report required under section 5333 or any 
        regulation prescribed under such section that contains a 
        material omission or misstatement of fact; or
            ``(3) structure or assist in structuring, or attempt to 
        structure or assist in structuring, any transaction with 1 or 
        more nonfinancial trades or businesses.'.
            (2) Technical and conforming amendments.--
                    (A) The heading for subsection (a) of section 5324 
                of title 31, United States Code, is amended by 
                inserting ``Involving Financial Institutions'' after 
                ``Transactions'.
                    (B) Section 5317(c) of title 31, United States 
                Code, is amended by striking ``5324(b)'' and inserting 
                ``5324(c)''.
    (c) Definition of Nonfinancial Trade or Business.--
            (1) In general.--Section 5312(a) of title 31, United States 
        Code, is amended--
                    (A) by redesignating paragraphs (4) and (5) as 
                paragraphs (5) and (6), respectively; and
                    (B) by inserting after paragraph (3) the following 
                new paragraph:
            ``(4) Nonfinancial trade or business.--The term 
        `nonfinancial trade or business' means any trade or business 
        other than a financial institution that is subject to the 
        reporting requirements of section 5313 and regulations 
        prescribed under such section.''.
            (2) Technical and conforming amendments.--
                    (A) Section 5312(a)(3)(C) of title 31, United 
                States Code, is amended by striking ``section 5316,'' 
                and inserting ``sections 5333 and 5316,''.
                    (B) Subsections (a) through (f) of section 5318 of 
                title 31, United States Code, and sections 5321, 5326, 
                and 5328 of such title are each amended--
                            (i) by inserting ``or nonfinancial trade or 
                        business'' after ``financial institution'' each 
                        place such term appears; and
                            (ii) by inserting ``or nonfinancial trades 
                        or businesses'' after ``financial 
                        institutions'' each place such term appears.
                    (C) Section 981(a)(1)(A) of title 18, United States 
                Code, is amended by striking ``5313(a) or 5324(a) of 
                title 31,'' and inserting ``5313(a) or 5333 of title 
                31, or subsection (a) or (b) of section 5324 of such 
                title,''.
                    (D) Section 982(a)(1) of title 18, United States 
                Code, is amended by inserting ``5333,'' after 
                ``5313(a),''.
    (c) Clerical Amendment.--The tables of sections for chapter 53 of 
title 31, United States Code, is amended by inserting after the item 
relating to section 5332 (as added by section 112 of this title) the 
following new item:

``5333. Reports relating to coins and currency received in nonfinancial 
                            trade or business.''.
    (f) Regulations.--Regulations which the Secretary of the Treasury 
determines are necessary to implement this section shall be published 
in final form before the end of the 6-month period beginning on the 
date of the enactment of this Act.

                  TITLE II--PUBLIC-PRIVATE COOPERATION

SEC. 201. ESTABLISHMENT OF HIGHLY SECURE NETWORK.

    (a) In General.--The Secretary of the Treasury shall establish a 
highly secure network in the Financial Crimes Enforcement Network 
that--
            (1) allows financial institutions to file reports required 
        under subchapter II or III of chapter 53 of title 31, United 
        States Code, chapter 2 of title I of Public Law 91-508, or 
        section 21 of the Federal Deposit Insurance Act through the 
        network; and
            (2) provides financial institutions with alerts and other 
        information regarding suspicious activities that warrant 
        immediate and enhanced scrutiny.
    (b) Expedited Development.--The Secretary of the Treasury shall 
take such action as may be necessary to ensure that the website 
required under subsection (a) is fully operational before the end of 
the 9-month period beginning on the date of the enactment of this Act.

SEC. 202. REPORT ON IMPROVEMENTS IN DATA ACCESS AND OTHER ISSUES.

    Before the end of the 6-month period beginning on the date of the 
enactment of this Act, the Secretary of the Treasury, after consulting 
with appropriate Federal functional regulators (as defined in section 
509 of the Gramm-Leach-Bliley Act), shall report to the Congress on the 
following issues:
            (1) Data collection and analysis.--Progress made since such 
        date of enactment in meeting the requirements of section 310(c) 
        of title 31, United States Code (as added by this Act).
            (2) Barriers to exchange of financial crime information.--
        Technical, legal, and other barriers to the exchange of 
        financial crime prevention and detection information among and 
        between Federal law enforcement agencies, including an 
        identification of all Federal law enforcement data systems 
        between which or among which data cannot be shared for whatever 
        reason.
            (3) Private banking.--Private banking activities in the 
        United States, including information on the following:
                    (A) The nature and extent of private banking 
                activities in the United States.
                    (B) Regulatory efforts to monitor private banking 
                activities and ensure that such activities are 
                conducted in compliance with subchapter II of chapter 
                53 of title 31, United States Code, and section 21 of 
                the Federal Deposit Insurance Act.
                    (C) With regard to financial institutions that 
                offer private banking services, the policies and 
                procedures of such institutions that are designed to 
                ensure compliance with the requirements of subchapter 
                II of chapter 53 of title 31, United States Code, and 
                section 21 of the Federal Deposit Insurance Act with 
                respect to private banking activity.

SEC. 203. REPORTS TO THE FINANCIAL SERVICES INDUSTRY ON SUSPICIOUS 
              FINANCIAL ACTIVITIES.

    At least once each calendar quarter, the Secretary of the Treasury 
shall--
            (1) publish a report containing a detailed analysis 
        identifying patterns of suspicious activity and other 
        investigative insights derived from suspicious activity reports 
        and investigations conducted by Federal, State, and local law 
        enforcement agencies to the extent appropriate; and
            (2) distribute such report to financial institutions (as 
        defined in section 5312 of title 31, United States Code).

SEC. 204. EFFICIENT USE OF CURRENCY TRANSACTION REPORT SYSTEM.

    (a) Findings.--The Congress finds the following:
            (1) The Congress established the currency transaction 
        reporting requirements in 1970 because the Congress found then 
        that such reports have a high degree of usefulness in criminal, 
        tax, and regulatory investigations and proceedings and the 
        usefulness of such reports has only increased in the years 
        since the requirements were established.
            (2) In 1994, in response to reports and testimony that 
        excess amounts of currency transaction reports were interfering 
        with effective law enforcement, the Congress reformed the 
        currency transaction report exemption requirements to provide--
                    (A) mandatory exemptions for certain reports that 
                had little usefulness for law enforcement, such as cash 
                transfers between depository institutions and cash 
                deposits from government agencies; and
                    (B) discretionary authority for the Secretary of 
                the Treasury to provide exemptions, subject to criteria 
                and guidelines established by the Secretary, for 
                financial institutions with regard to regular business 
                customers that maintain accounts at an institution into 
                which frequent cash deposits are made.
            (3) Today there is evidence that some financial 
        institutions are not utilizing the exemption system, or are 
        filing reports even if there is an exemption in effect, with 
        the result that the volume of currency transaction reports is 
        once again interfering with effective law enforcement.
    (b) Study and Report.--
            (1) Study required.--The Secretary of the Treasury shall 
        conduct a study of--
                    (A) the possible expansion of the statutory 
                exemption system in effect under 5313 of title 31, 
                United States Code; and
                    (B) methods for improving financial institution 
                utilization of the statutory exemption provisions as a 
                way of reducing the submission of currency transaction 
                reports that have little or no value for law 
                enforcement purposes, including improvements in the 
                systems in effect at financial institutions for regular 
                review of the exemption procedures used at the 
                institution and the training of personnel in its 
                effective use.
            (2) Report required.--The Secretary of the Treasury shall 
        submit a report to the Congress before the end of the 90-day 
        period beginning on the date of the enactment of this Act 
        containing the findings and conclusions of the Secretary with 
        regard to the study required under subsection (a) and such 
        recommendations for legislative or administrative action as the 
        Secretary determines to be appropriate.

SEC. 205. PUBLIC-PRIVATE TASK FORCE ON TERRORIST FINANCING ISSUES.

    Section 1564 of the Annunzio--Wylie Anti-Money Laundering Act (31 
U.S.C. 5311 note) is amended by adding at the end the following new 
subsection:
    ``(d) Terrorist Financing Issues.--
            ``(1) In general.--The Secretary of the Treasury shall 
        provide, either within the Bank Secrecy Act Advisory Group, or 
        as a subcommittee or other adjunct of the Advisory Group, for a 
        task force of representatives from agencies and officers 
        represented on the Advisory Group, a representative of the 
        Director of the Office of Homeland Security, and 
        representatives of financial institutions, private 
        organizations that represent the financial services industry, 
        and other interested parties to focus on--
                    ``(A) issues specifically related to the finances 
                of terrorist groups, the means terrorist groups use to 
                transfer funds around the world and within the United 
                States, including through the use of charitable 
                organizations, nonprofit organizations, and 
                nongovernmental organizations, and the extent to which 
                financial institutions in the United States are 
                unwittingly involved in such finances and the extent to 
                which such institutions are at risk as a result;
                    ``(B) the relationship, particularly the financial 
                relationship, between international narcotics 
                traffickers and foreign terrorist organizations, the 
                extent to which their memberships overlap and engage in 
                joint activities, and the extent to which they 
                cooperate with each other in raising and transferring 
                funds for their respective purposes; and
                    ``(C) means of facilitating the identification of 
                accounts and transactions involving terrorist groups 
                and facilitating the exchange of information concerning 
                such accounts and transactions between financial 
                institutions and law enforcement organizations.
            ``(2) Applicability of other provisions.--Sections 552, 
        552a, and 552b of title 5, United States Code, and the Federal 
        Advisory Committee Act shall not apply to the task force 
        established pursuant to paragraph (1).''.

SEC. 206. SUSPICIOUS ACTIVITY REPORTING REQUIREMENTS.

    (a) Deadline For Suspicious Activity Reporting Requirements For 
Registered Brokers and Dealers.--The Secretary of the Treasury, in 
consultation with the Securities and Exchange Commission, shall publish 
proposed regulations in the Federal Register before January 1, 2002, 
requiring brokers and dealers registered with the Securities and 
Exchange Commission under the Securities Exchange Act of 1934 to submit 
suspicious activity reports under section 5318(g) of title 31, United 
States Code. Such regulations shall be published in final form no later 
than June 1, 2002.
    (b) Suspicious Activity Reporting Requirements For Futures 
Commission Merchants, Commodity Trading Advisors, and Commodity Pool 
Operators.--The Secretary of the Treasury, in consultation with the 
Commodity Futures Trading Commission, may prescribe regulations 
requiring futures commission merchants, commodity trading advisors, and 
commodity pool operators registered under the Commodity Exchange Act to 
submit suspicious activity reports under section 5318(g) of title 31, 
United States Code.

SEC. 207. AMENDMENTS RELATING TO REPORTING OF SUSPICIOUS ACTIVITIES.

    (a) Amendment Relating to Civil Liability Immunity for 
Disclosures.--Section 5318(g)(3) of title 31, United States Code, is 
amended to read as follows:
            ``(3) Liability for disclosures.--
                    ``(A) In general.--Any financial institution that 
                makes a voluntary disclosure of any possible violation 
                of law or regulation to a government agency or makes a 
                disclosure pursuant to this subsection or any other 
                authority, and any director, officer, employee, or 
                agent of such institution who makes, or requires 
                another to make any such disclosure, shall not be 
                liable to any person under any law or regulation of the 
                United States, any constitution, law, or regulation of 
                any State or political subdivision of any State, or 
                under any contract or other legally enforceable 
                agreement (including any arbitration agreement), for 
                such disclosure or for any failure to provide notice of 
                such disclosure to any person.
                    ``(B) Rule of construction.--Subparagraph (A) shall 
                not be construed as creating--
                            ``(i) any inference that the term `person', 
                        as used in such subparagraph, may be construed 
                        more broadly than its ordinary usage so to 
                        include any government or agency of government; 
                        or
                            ``(ii) any immunity against, or otherwise 
                        affecting, any civil or criminal action brought 
                        by any government or agency of government to 
                        enforce any constitution, law, or regulation of 
                        such government or agency.''.
    (b) Prohibition on Notification of Disclosures.--Section 5318(g)(2) 
of title 31, United States Code, is amended to read as follows:
            ``(2) Notification prohibited.--
                    ``(A) In general.--If a financial institution or 
                any director, officer, employee, or agent of any 
                financial institution, voluntarily or pursuant to this 
                section or any other authority, reports a suspicious 
                transaction to a government agency--
                            ``(i) the financial institution, director, 
                        officer, employee, or agent may not notify any 
                        person involved in the transaction that the 
                        transaction has been reported; and
                            ``(ii) no officer or employee of the 
                        Federal Government or of any State, local, 
                        tribal, or territorial government within the 
                        United States, who has any knowledge that such 
                        report was made may disclose to any person 
                        involved in the transaction that the 
                        transaction has been reported other than as 
                        necessary to fulfill the official duties of 
                        such officer or employee.
                    ``(B) Disclosures in certain employment 
                references.--Notwithstanding the application of 
                subparagraph (A) in any other context, subparagraph (A) 
                shall not be construed as prohibiting any financial 
                institution, or any director, officer, employee, or 
                agent of such institution, from including, in a written 
                employment reference that is provided in accordance 
                with section 18(v) of the Federal Deposit Insurance Act 
                in response to a request from another financial 
                institution or a written termination notice or 
                employment reference that is provided in accordance 
                with the rules of the self-regulatory organizations 
                registered with the Securities and Exchange Commission 
                or the Commodity Futures Trading Commission, 
                information that was included in a report to which 
                subparagraph (A) applies, but such written employment 
                reference may not disclose that such information was 
                also included in any such report or that such report 
                was made.''.

SEC. 208. AUTHORIZATION TO INCLUDE SUSPICIONS OF ILLEGAL ACTIVITY IN 
              WRITTEN EMPLOYMENT REFERENCES.

    Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is 
amended by adding at the end the following new subsection:
    ``(w) Written Employment References May Contain Suspicions of 
Involvement in Illegal Activity.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, any insured depository institution, and any director, 
        officer, employee, or agent of such institution, may disclose 
        in any written employment reference relating to a current or 
        former institution-affiliated party of such institution which 
        is provided to another insured depository institution in 
        response to a request from such other institution, information 
        concerning the possible involvement of such institution-
        affiliated party in potentially unlawful activity, to the 
        extent--
                    ``(A) the disclosure does not contain information 
                which the institution, director, officer, employee, or 
                agent knows to be false; and
                    ``(B) the institution, director, officer, employee, 
                or agent has not acted with malice or with reckless 
                disregard for the truth in making the disclosure.
            ``(2) Definition.--For purposes of this subsection, the 
        term `insured depository institution' includes any uninsured 
        branch or agency of a foreign bank.''.

SEC. 209. INTERNATIONAL COOPERATION ON IDENTIFICATION OF ORIGINATORS OF 
              WIRE TRANSFERS.

    The Secretary of the Treasury shall--
            (1) in consultation with the Attorney General and the 
        Secretary of State, take all reasonable steps to encourage 
        foreign governments to require the inclusion of the name of the 
        originator in wire transfer instructions sent to the United 
        States and other countries, with the information to remain with 
        the transfer from its origination until the point of 
        disbursement; and
            (2) report annually to the Committee on Financial Services 
        of the House of Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate on--
                    (A) progress toward the goal enumerated in 
                paragraph (1), as well as impediments to implementation 
                and an estimated compliance rate; and
                    (B) impediments to instituting a regime in which 
                all appropriate identification, as defined by the 
                Secretary, about wire transfer recipients shall be 
                included with wire transfers from their point of 
                origination until disbursement.

SEC. 210. CHECK TRUNCATION STUDY.

    Before the end of the 180-day period beginning on the date of the 
enactment of this Act, the Secretary of the Treasury, in consultation 
with the Attorney General and the Board of Governors of the Federal 
Reserve System, shall conduct a study of the impact on--
            (1) crime prevention (including money laundering and 
        terrorism);
            (2) law enforcement;
            (3) the financial services industry (including the 
        technical, operational, and economic impact on the industry) 
        and customers of such industry;
            (4) the payment system (including the liquidity, stability, 
        and efficiency of the payment system and the ability to monitor 
        and access the flow of funds); and
            (5) the consumer protection laws,
of any policy of the Board of Governors of the Federal Reserve System 
relating to the promotion of check electronification, through 
truncation or other means, or migration away from paper checks. The 
study shall also include an analysis of the benefits and burdens of 
promoting check electronification on the foregoing entities.

          TITLE III--COMBATTING INTERNATIONAL MONEY LAUNDERING

SEC. 301. SPECIAL MEASURES FOR JURISDICTIONS, FINANCIAL INSTITUTIONS, 
              OR INTERNATIONAL TRANSACTIONS OF PRIMARY MONEY LAUNDERING 
              CONCERN.

    (a) In General.--Subchapter II of chapter 53 of title 31, United 
States Code, is amended by inserting after section 5318 the following 
new section:
``Sec. 5318A. Special measures for jurisdictions, financial 
              institutions, or international transactions of primary 
              money laundering concern
    ``(a) International Counter-Money Laundering Requirements.--
            ``(1) In general.--The Secretary may require domestic 
        financial institutions and domestic financial agencies to take 
        1 or more of the special measures described in subsection (b) 
        if the Secretary finds that reasonable grounds exist for 
        concluding that a jurisdiction outside of the United States, 1 
        or more financial institutions operating outside of the United 
        States, 1 or more classes of transactions within, or involving, 
        a jurisdiction outside of the United States, or 1 or more types 
        of accounts is of primary money laundering concern, in 
        accordance with subsection (c).
            ``(2) Form of requirement.--The special measures described 
        in--
                    ``(A) subsection (b) may be imposed in such 
                sequence or combination as the Secretary shall 
                determine;
                    ``(B) paragraphs (1) through (4) of subsection (b) 
                may be imposed by regulation, order, or otherwise as 
                permitted by law; and
                    ``(C) subsection (b)(5) may be imposed only by 
                regulation.
            ``(3) Duration of orders; rulemaking.--Any order by which a 
        special measure described in paragraphs (1) through (4) of 
        subsection (b) is imposed (other than an order described in 
        section 5326)--
                    ``(A) shall be issued together with a notice of 
                proposed rulemaking relating to the imposition of such 
                special measure; and
                    ``(B) may not remain in effect for more than 120 
                days, except pursuant to a regulation prescribed on or 
                before the end of the 120-day period beginning on the 
                date of issuance of such order.
            ``(4) Process for selecting special measures.--In selecting 
        which special measure or measures to take under this 
        subsection, the Secretary--
                    ``(A) shall consult with the Chairman of the Board 
                of Governors of the Federal Reserve System, any other 
                appropriate Federal banking agency (as defined in 
                section 3 of the Federal Deposit Insurance Act), the 
                Secretary of State, the Securities and Exchange 
                Commission, the Commodity Futures Trading Commission, 
                the National Credit Union Administration Board, and in 
                the sole discretion of the Secretary such other 
                agencies and interested parties as the Secretary may 
                find to be appropriate; and
                    ``(B) shall consider--
                            ``(i) whether similar action has been or is 
                        being taken by other nations or multilateral 
                        groups;
                            ``(ii) whether the imposition of any 
                        particular special measure would create a 
                        significant competitive disadvantage, including 
                        any undue cost or burden associated with 
                        compliance, for financial institutions 
                        organized or licensed in the United States;
                            ``(iii) the extent to which the action or 
                        the timing of the action would have a 
                        significant adverse systemic impact on the 
                        international payment, clearance, and 
                        settlement system, or on legitimate business 
                        activities involving the particular 
                        jurisdiction, institution, or class of 
                        transactions; and
                            ``(iv) the effect on national security and 
                        foreign policy.
            ``(5) No limitation on other authority.--This section shall 
        not be construed as superseding or otherwise restricting any 
        other authority granted to the Secretary, or to any other 
        agency, by this subchapter or otherwise.
    ``(b) Special Measures.--The special measures referred to in 
subsection (a), with respect to a jurisdiction outside of the United 
States, financial institution operating outside of the United States, 
class of transaction within, or involving, a jurisdiction outside of 
the United States, or 1 or more types of accounts are as follows:
            ``(1) Recordkeeping and reporting of certain financial 
        transactions.--
                    ``(A) In general.--The Secretary may require any 
                domestic financial institution or domestic financial 
                agency to maintain records, file reports, or both, 
                concerning the aggregate amount of transactions, or 
                concerning each transaction, with respect to a 
                jurisdiction outside of the United States, 1 or more 
                financial institutions operating outside of the United 
                States, 1 or more classes of transactions within, or 
                involving, a jurisdiction outside of the United States, 
                or 1 or more types of accounts if the Secretary finds 
                any such jurisdiction, institution, or class of 
                transactions to be of primary money laundering concern.
                    ``(B) Form of records and reports.--Such records 
                and reports shall be made and retained at such time, in 
                such manner, and for such period of time, as the 
                Secretary shall determine, and shall include such 
                information as the Secretary may determine, including--
                            ``(i) the identity and address of the 
                        participants in a transaction or relationship, 
                        including the identity of the originator of any 
                        funds transfer;
                            ``(ii) the legal capacity in which a 
                        participant in any transaction is acting;
                            ``(iii) the identity of the beneficial 
                        owner of the funds involved in any transaction, 
                        in accordance with such procedures as the 
                        Secretary determines to be reasonable and 
                        practicable to obtain and retain the 
                        information; and
                            ``(iv) a description of any transaction.
            ``(2) Information relating to beneficial ownership.--In 
        addition to any other requirement under any other provision of 
        law, the Secretary may require any domestic financial 
        institution or domestic financial agency to take such steps as 
        the Secretary may determine to be reasonable and practicable to 
        obtain and retain information concerning the beneficial 
        ownership of any account opened or maintained in the United 
        States by a foreign person (other than a foreign entity whose 
        shares are subject to public reporting requirements or are 
        listed and traded on a regulated exchange or trading market), 
        or a representative of such a foreign person, that involves a 
        jurisdiction outside of the United States, 1 or more financial 
        institutions operating outside of the United States, 1 or more 
        classes of transactions within, or involving, a jurisdiction 
        outside of the United States, or 1 or more types of accounts if 
        the Secretary finds any such jurisdiction, institution, 
        transaction, or account to be of primary money laundering 
        concern.
            ``(3) Information relating to certain payable-through 
        accounts.--If the Secretary finds a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, or 1 or more classes of 
        transactions within, or involving, a jurisdiction outside of 
        the United States to be of primary money laundering concern, 
        the Secretary may require any domestic financial institution or 
        domestic financial agency that opens or maintains a payable-
        through account in the United States for a foreign financial 
        institution involving any such jurisdiction or any such 
        financial institution operating outside of the United States, 
        or a payable through account through which any such transaction 
        may be conducted, as a condition of opening or maintaining such 
        account--
                    ``(A) to identify each customer (and representative 
                of such customer) of such financial institution who is 
                permitted to use, or whose transactions are routed 
                through, such payable-through account; and
                    ``(B) to obtain, with respect to each such customer 
                (and each such representative), information that is 
                substantially comparable to that which the depository 
                institution obtains in the ordinary course of business 
                with respect to its customers residing in the United 
                States.
            ``(4) Information relating to certain correspondent 
        accounts.--If the Secretary finds a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, or 1 or more classes of 
        transactions within, or involving, a jurisdiction outside of 
        the United States to be of primary money laundering concern, 
        the Secretary may require any domestic financial institution or 
        domestic financial agency that opens or maintains a 
        correspondent account in the United States for a foreign 
        financial institution involving any such jurisdiction or any 
        such financial institution operating outside of the United 
        States, or a correspondent account through which any such 
        transaction may be conducted, as a condition of opening or 
        maintaining such account--
                    ``(A) to identify each customer (and representative 
                of such customer) of any such financial institution who 
                is permitted to use, or whose transactions are routed 
                through, such correspondent account; and
                    ``(B) to obtain, with respect to each such customer 
                (and each such representative), information that is 
                substantially comparable to that which the depository 
                institution obtains in the ordinary course of business 
                with respect to its customers residing in the United 
                States.
            ``(5) Prohibitions or conditions on opening or maintaining 
        certain correspondent or payable-through accounts.--If the 
        Secretary finds a jurisdiction outside of the United States, 1 
        or more financial institutions operating outside of the United 
        States, or 1 or more classes of transactions within, or 
        involving, a jurisdiction outside of the United States to be of 
        primary money laundering concern, the Secretary, in 
        consultation with the Secretary of State, the Attorney General, 
        and the Chairman of the Board of Governors of the Federal 
        Reserve System, may prohibit, or impose conditions upon, the 
        opening or maintaining in the United States of a correspondent 
        account or payable- through account by any domestic financial 
        institution or domestic financial agency for or on behalf of a 
        foreign banking institution, if such correspondent account or 
        payable-through account involves any such jurisdiction or 
        institution, or if any such transaction may be conducted 
        through such correspondent account or payable-through account.
    ``(c) Consultations and Information To Be Considered in Finding 
Jurisdictions, Institutions, Types of Accounts, or Transactions To Be 
of Primary Money Laundering Concern.--
            ``(1) In general.--In making a finding that reasonable 
        grounds exist for concluding that a jurisdiction outside of the 
        United States, 1 or more financial institutions operating 
        outside of the United States, 1 or more classes of transactions 
        within, or involving, a jurisdiction outside of the United 
        States, or 1 or more types of accounts is of primary money 
        laundering concern so as to authorize the Secretary to take 1 
        or more of the special measures described in subsection (b), 
        the Secretary shall consult with the Secretary of State, and 
        the Attorney General.
            ``(2) Additional considerations.--In making a finding 
        described in paragraph (1), the Secretary shall consider in 
        addition such information as the Secretary determines to be 
        relevant, including the following potentially relevant factors:
                    ``(A) Jurisdictional factors.--In the case of a 
                particular jurisdiction--
                            ``(i) evidence that organized criminal 
                        groups, international terrorists, or both, have 
                        transacted business in that jurisdiction;
                            ``(ii) the extent to which that 
                        jurisdiction or financial institutions 
                        operating in that jurisdiction offer bank 
                        secrecy or special regulatory advantages to 
                        nonresidents or nondomiciliaries of that 
                        jurisdiction;
                            ``(iii) the substance and quality of 
                        administration of the bank supervisory and 
                        counter-money laundering laws of that 
                        jurisdiction;
                            ``(iv) the relationship between the volume 
                        of financial transactions occurring in that 
                        jurisdiction and the size of the economy of the 
                        jurisdiction;
                            ``(v) the extent to which that jurisdiction 
                        is characterized as an offshore banking or 
                        secrecy haven by credible international 
                        organizations or multilateral expert groups;
                            ``(vi) whether the United States has a 
                        mutual legal assistance treaty with that 
                        jurisdiction, and the experience of United 
                        States law enforcement officials, and 
                        regulatory officials in obtaining information 
                        about transactions originating in or routed 
                        through or to such jurisdiction; and
                            ``(vii) the extent to which that 
                        jurisdiction is characterized by high levels of 
                        official or institutional corruption.
                    ``(B) Institutional factors.--In the case of a 
                decision to apply 1 or more of the special measures 
                described in subsection (b) only to a financial 
                institution or institutions, or to a transaction or 
                class of transactions, or to a type of account, or to 
                all 3, within or involving a particular jurisdiction--
                            ``(i) the extent to which such financial 
                        institutions, transactions, or types of 
                        accounts are used to facilitate or promote 
                        money laundering in or through the 
                        jurisdiction;
                            ``(ii) the extent to which such 
                        institutions, transactions, or types of 
                        accounts are used for legitimate business 
                        purposes in the jurisdiction; and
                            ``(iii) the extent to which such action is 
                        sufficient to ensure, with respect to 
                        transactions involving the jurisdiction and 
                        institutions operating in the jurisdiction, 
                        that the purposes of this subchapter continue 
                        to be fulfilled, and to guard against 
                        international money laundering and other 
                        financial crimes.
    ``(d) Notification of Special Measures Invoked by the Secretary.--
Not later than 10 days after the date of any action taken by the 
Secretary under subsection (a)(1), the Secretary shall notify, in 
writing, the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate of any such action.
    ``(e) Definitions.--Notwithstanding any other provision of this 
subchapter, for purposes of this section, the following definitions 
shall apply:
            ``(1) Bank definitions.--The following definitions shall 
        apply with respect to a bank:
                    ``(A) Account.--The term `account'--
                            ``(i) means a formal banking or business 
                        relationship established to provide regular 
                        services, dealings, and other financial 
                        transactions; and
                            ``(ii) includes a demand deposit, savings 
                        deposit, or other transaction or asset account 
                        and a credit account or other extension of 
                        credit.
                    ``(B) Correspondent account.--The term 
                `correspondent account' means an account established to 
                receive deposits from, make payments on behalf of a 
                foreign financial institution, or handle other 
                financial transactions related to such institution.
                    ``(C) Payable-through account.--The term `payable-
                through account' means an account, including a 
                transaction account (as defined in section 19(b)(1)(C) 
                of the Federal Reserve Act), opened at a depository 
                institution by a foreign financial institution by means 
                of which the foreign financial institution permits its 
                customers to engage, either directly or through a 
                subaccount, in banking activities usual in connection 
                with the business of banking in the United States.
                    ``(D) Secretary.--The term `Secretary' means the 
                Secretary of the Treasury.
            ``(2) Definitions applicable to institutions other than 
        banks.--With respect to any financial institution other than a 
        bank, the Secretary shall, after consultation with the 
        appropriate Federal functional regulators (as defined in 
        section 509 of the Gramm-Leach-Bliley Act), define by 
        regulation the term `account', and shall include within the 
        meaning of that term, to the extent, if any, that the Secretary 
        deems appropriate, arrangements similar to payable-through and 
        correspondent accounts.
            ``(3) Regulatory definition.--The Secretary shall prescribe 
        regulations defining beneficial ownership of an account for 
        purposes of this subchapter. Such regulations shall address 
        issues related to an individual's authority to fund, direct, or 
        manage the account (including the power to direct payments into 
        or out of the account), and an individual's material interest 
        in the income or corpus of the account, and shall ensure that 
        the identification of individuals under this section does not 
        extend to any individual whose beneficial interest in the 
        income or corpus of the account is immaterial.
            ``(4) Other terms.--The Secretary may, by regulation, 
        further define the terms in paragraphs (1) and (2) and define 
        other terms for the purposes of this section, as the Secretary 
        deems appropriate.''.
    (b) Financial Institutions Specified in Subchapter II of Chapter 53 
of Title 31, United States Code.--
            (1) Credit unions.--Subparagraph (E) of section 5312(2) of 
        title 31, United States Code, is amended to read as follows:
                    ``(E) any credit union;''.
            (2) Futures commission merchant; commodity trading advisor; 
        commodity pool operator.--Section 5312 of title 31, United 
        States Code, is amended by adding at the end the following new 
        subsection:
    ``(c) Additional Definitions.--For purposes of this subchapter, the 
following definitions shall apply:
            ``(1) Certain institutions included in definition.--The 
        term `financial institution' (as defined in subsection (a)) 
        includes the following:
                    ``(A) Any futures commission merchant, commodity 
                trading advisor, or commodity pool operator registered, 
                or required to register, under the Commodity Exchange 
                Act.''.
            (3) CFTC included.--For purposes of this Act and any 
        amendment made by this Act to any other provision of law, the 
        term ``Federal functional regulator'' includes the Commodity 
        Futures Trading Commission.
    (c) Clerical Amendment.--The table of sections for subchapter II of 
chapter 53 of title 31, United States Code, is amended by inserting 
after the item relating to section 5318 the following new item:

``5318A. Special measures for jurisdictions, financial institutions, or 
                            international transactions of primary money 
                            laundering concern.''.

SEC. 302. SPECIAL DUE DILIGENCE FOR CORRESPONDENT ACCOUNTS AND PRIVATE 
              BANKING ACCOUNTS.

    (a) In General.--Section 5318 of title 31, United States Code, is 
amended by inserting after subsection (i) (as added by section 119 of 
this Act) the following new subsection:
    ``(j) Due Diligence for United States Private Banking and 
Correspondent Bank Accounts Involving Foreign Persons.--
            ``(1) In general.--Each financial institution that 
        establishes, maintains, administers, or manages a private 
        banking account or a correspondent account in the United States 
        for a non-United States person, including a foreign individual 
        visiting the United States, or a representative of a non-United 
        States person, shall establish appropriate, specific, and, 
        where necessary, enhanced due diligence policies, procedures, 
        and controls to detect and report instances of money laundering 
        through those accounts.
            ``(2) Special standards for certain correspondent 
        accounts.--
                    ``(A) In general.--Subparagraph (B) shall apply if 
                a correspondent account is requested or maintained by, 
                or on behalf of, a foreign bank operating--
                            ``(i) under an offshore banking license; or
                            ``(ii) under a banking license issued by a 
                        foreign country that has been designated--
                                    ``(I) as noncooperative with 
                                international anti-money laundering 
                                principles or procedures by an 
                                intergovernmental group or organization 
                                of which the United States is a member 
                                with which designation the Secretary of 
                                the Treasury concurs; or
                                    ``(II) by the Secretary as 
                                warranting special measures due to 
                                money laundering concerns.
                    ``(B) Policies, procedures, and controls.--The 
                enhanced due diligence policies, procedures, and 
                controls required under paragraph (1) for foreign banks 
                described in subparagraph (A) shall, at a minimum, 
                ensure that the financial institution in the United 
                States takes reasonable steps--
                            ``(i) to ascertain for any such foreign 
                        bank, the shares of which are not publicly 
                        traded, the identity of each of the owners of 
                        the foreign bank, and the nature and extent of 
                        the ownership interest of each such owner;
                            ``(ii) to conduct enhanced scrutiny of such 
                        account to guard against money laundering and 
                        report any suspicious transactions under 
                        section 5318(g); and
                            ``(iii) to ascertain whether such foreign 
                        bank provides correspondent accounts to other 
                        foreign banks and, if so, the identity of those 
                        foreign banks and related due diligence 
                        information, as appropriate under paragraph 
                        (1).
            ``(3) Minimum standards for private banking accounts.--If a 
        private banking account is requested or maintained by, or on 
        behalf of, a non-United States person, then the due diligence 
        policies, procedures, and controls required under paragraph (1) 
        shall, at a minimum, ensure that the financial institution 
        takes reasonable steps--
                    ``(A) to ascertain the identity of the nominal and 
                beneficial owners of, and the source of funds deposited 
                into, such account as needed to guard against money 
                laundering and report any suspicious transactions under 
                section 5318(g); and
                    ``(B) to conduct enhanced scrutiny of any such 
                account that is requested or maintained by, or on 
                behalf of, a senior foreign political figure, or any 
                immediate family member or close associate of a senior 
                foreign political figure, to prevent, detect, and 
                report transactions that may involve the proceeds of 
                foreign corruption.
            ``(4) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                    ``(A) Offshore banking license.--The term `offshore 
                banking license' means a license to conduct banking 
                activities which, as a condition of the license, 
                prohibits the licensed entity from conducting banking 
                activities with the citizens of, or with the local 
                currency of, the country which issued the license.
                    ``(B) Private bank account.--The term `private bank 
                account' means an account (or any combination of 
                accounts) that--
                            ``(i) requires a minimum aggregate deposits 
                        of funds or other assets of not less than 
                        $1,000,000;
                            ``(ii) is established on behalf of 1 or 
                        more individuals who have a direct or 
                        beneficial ownership interest in the account; 
                        and
                            ``(iii) is assigned to, or is administered 
                        or managed by, in whole or in part, an officer, 
                        employee, or agent of a financial institution 
                        acting as a liaison between the financial 
                        institution and the direct or beneficial owner 
                        of the account.
            ``(5) Regulatory authority.--Before the end of the 6-month 
        period beginning on the date of the enactment of the Financial 
        Anti-Terrorism Act of 2001, the Secretary, in consultation with 
        the appropriate Federal functional regulators (as defined in 
        section 509 of the Gramm-Leach-Bliley Act) shall further define 
        and clarify, by regulation, the requirements of this 
        subsection.''.
    (b) Effective Date.--The amendments made by this section shall take 
effect beginning 180 days after the date of the enactment of this Act 
with respect to accounts covered by subsection (j) of section 5318 of 
title 31, United States Code (as added by this section) that are opened 
before, on, or after the date of the enactment of this Act.

SEC. 303. PROHIBITION ON UNITED STATES CORRESPONDENT ACCOUNTS WITH 
              FOREIGN SHELL BANKS.

    Section 5318 of title 31, United States Code, is amended by 
inserting after subsection (j) (as added by section 302 of this title) 
the following new subsection:
    ``(k) Prohibition on United States Correspondent Accounts With 
Foreign Shell Banks.--
            ``(1) In general.--A depository institution shall not 
        establish, maintain, administer, or manage a correspondent 
        account in the United States for, or on behalf of, a foreign 
        bank that does not have a physical presence in any country.
            ``(2) Prevention of indirect service to foreign shell 
        banks.--
                    ``(A) In general.--A depository institution shall 
                take reasonable steps to ensure that any correspondent 
                account established, maintained, administered, or 
                managed by that institution in the United States for a 
                foreign bank is not being used by that foreign bank to 
                indirectly provide banking services to another foreign 
                bank that does not have a physical presence in any 
                country.
                    ``(B) Regulations.--The Secretary shall, in 
                regulations, delineate reasonable steps necessary for a 
                depository institution to comply with this subsection.
            ``(3) Exception.--Paragraphs (1) and (2) shall not be 
        construed as prohibiting a depository institution from 
        providing a correspondent account to a foreign bank, if the 
        foreign bank--
                    ``(A) is an affiliate of a depository institution, 
                credit union, or other foreign bank that maintains a 
                physical presence in the United States or a foreign 
                country, as applicable; and
                    ``(B) is subject to supervision by a banking 
                authority in the country regulating the affiliated 
                depository institution, credit union, or foreign bank, 
                described in subparagraph (A), as applicable.
            ``(4) Definitions.--For purposes of this section, the 
        following definitions shall apply:
                    ``(A) Affiliate.--The term `affiliate' means a 
                foreign bank that is controlled by or is under common 
                control with a depository institution, credit union, or 
                foreign bank.
                    ``(B) Depository institution.--The `depository 
                institution'--
                            ``(i) has the meaning given such term in 
                        section 3 of the Federal Deposit Insurance Act; 
                        and
                            ``(ii) includes a credit union.
                    ``(C) Physical presence.--The term `physical 
                presence' means a place of business that--
                            ``(i) is maintained by a foreign bank;
                            ``(ii) is located at a fixed address (other 
                        than solely an electronic address) in a country 
                        in which the foreign bank is authorized to 
                        conduct banking activities, at which location 
                        the foreign bank--
                                    ``(I) employs 1 or more individuals 
                                on a full-time basis; and
                                    ``(II) maintains operating records 
                                related to its banking activities; and
                            ``(iii) is subject to inspection by the 
                        banking authority which licensed the foreign 
                        bank to conduct banking activities.''.

SEC. 304. ANTI-MONEY LAUNDERING PROGRAMS.

    (a) In General.--Section 5318(h) of title 31, United States Code, 
is amended to read as follows:
    ``(h) Anti-Money Laundering Programs.--
            ``(1) In general.--In order to guard against money 
        laundering through financial institutions, each financial 
        institution shall establish anti-money laundering programs, 
        including, at a minimum--
                    ``(A) the development of internal policies, 
                procedures, and controls;
                    ``(B) the designation of an officer of the 
                financial institution responsible for compliance;
                    ``(C) an ongoing employee training program; and
                    ``(D) an independent audit function to test 
                programs.
            ``(2) Regulations.--The Secretary may, after consultation 
        with the appropriate Federal functional regulators (as defined 
        in section 509 of the Gramm-Leach-Bliley Act), prescribe 
        minimum standards for programs established under paragraph (1), 
        and may exempt from the application of those standards any 
        financial institution that is not subject to the provisions of 
        the regulations contained in part 103 of title 31, of the Code 
        of Federal Regulations, as in effect on the date of the 
        enactment of the Financial Anti-Terrorism Act of 2001, or any 
        successor to such regulations, for so long as such financial 
        institution is not subject to the provisions of such 
        regulations.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect at the end of the 180-day period beginning on the date of 
the enactment of this Act.
    (c) Date of Application of Regulations; Factors to Be Taken Into 
Account.--Before the end of the 180-day period beginning on the date of 
the enactment of this Act, the Secretary of the Treasury shall 
prescribe regulations to implement the amendment made by subsection 
(a). In prescribing such regulations, the Secretary shall consider the 
extent to which the requirements imposed under such regulations are 
commensurate with the size, location, and activities of the financial 
institutions to which such regulations apply.

SEC. 305. CONCENTRATION ACCOUNTS AT FINANCIAL INSTITUTIONS.

    Section 5318(h) of title 31, United States Code (as amended by 
section 304) is amended by adding at the end the following:
            ``(3) Concentration accounts.--The Secretary may prescribe 
        regulations under this subsection that govern maintenance of 
        concentration accounts by financial institutions, in order to 
        ensure that such accounts are not used to prevent association 
        of the identity of an individual customer with the movement of 
        funds of which the customer is the direct or beneficial owner, 
        which regulations shall, at a minimum--
                    ``(A) prohibit financial institutions from allowing 
                clients to direct transactions that move their funds 
                into, out of, or through the concentration accounts of 
                the financial institution;
                    ``(B) prohibit financial institutions and their 
                employees from informing customers of the existence of, 
                or the means of identifying, the concentration accounts 
                of the institution; and
                    ``(C) require each financial institution to 
                establish written procedures governing the 
                documentation of all transactions involving a 
                concentration account, which procedures shall ensure 
                that, any time a transaction involving a concentration 
                account commingles funds belonging to 1 or more 
                customers, the identity of, and specific amount 
                belonging to, each customer is documented.''.

SEC. 306. INTERNATIONAL COOPERATION IN INVESTIGATIONS OF MONEY 
              LAUNDERING, FINANCIAL CRIMES, AND THE FINANCES OF 
              TERRORIST GROUPS.

  (a) Negotiations.--
            (1) In general.--It is the sense of the Congress that, in 
        addition to the existing requirements of section 4702 of the 
        Anti-Drug Abuse Act of 1988, the President should direct the 
        Secretary of State, the Attorney General, or the Secretary of 
        the Treasury, as appropriate and in consultation with the Board 
        of Governors of the Federal Reserve System, to seek to enter 
        into negotiations with the appropriate financial supervisory 
        agencies and other officials of any foreign country the 
        financial institutions of which do business with United States 
        financial institutions or which may be utilized by any foreign 
        terrorist organization (as designated under section 219 of the 
        Immigration and Nationality Act), any person who is a member or 
        representative of any such organization, or any person engaged 
        in money laundering or financial or other crimes.
            (2) Purposes of negotiations.--It is the sense of the 
        Congress that, in carrying out any negotiations described in 
        paragraph (1), the President should direct the Secretary of 
        State, the Attorney General, or the Secretary of the Treasury, 
        as appropriate, to seek to enter into and further cooperative 
        efforts, voluntary information exchanges, the use of letters 
        rogatory, mutual legal assistance treaties, and international 
        agreements to--
                    (A) ensure that foreign banks and other financial 
                institutions maintain adequate records of--
                            (i) large United States currency 
                        transactions; and
                            (ii) transaction and account information 
                        relating to any foreign terrorist organization 
                        (as designated under section 219 of the 
                        Immigration and Nationality Act), any person 
                        who is a member or representative of any such 
                        organization, or any person engaged in money 
                        laundering or financial or other crimes; and
          (B) establish a mechanism whereby such records may be made 
        available to United States law enforcement officials and 
        domestic financial institution supervisors, when appropriate.
    (b) Reports.--
            (1) In general.--Not later than 1 year after the date of 
        the enactment of this Act and annually thereafter, the 
        Secretary of State, in conjunction with the Attorney General 
        and the Secretary of the Treasury, shall submit a report to the 
        Congress, on the progress in any negotiations described in 
        subsection (a).
            (2) Identification of certain countries.--In any report 
        submitted under paragraph (1), the Secretary of State shall 
        identify countries--
                    (A) with respect to which the Secretary determines 
                there is evidence that the financial institutions in 
                such countries are being utilized by any foreign 
                terrorist organization (as designated under section 219 
                of the Immigration and Nationality Act), any person who 
                is a member or representative of any such organization, 
                or any person engaged in money laundering or financial 
                or other crimes; and
                    (B) which have not reached agreement with United 
                States authorities to meet the objectives of 
                subparagraphs (A) and (B) of subsection (a)(2).
            (3) Report on penalties and sanctions.--If the President 
        determines that--
                    (A) a foreign country is described in subparagraphs 
                (A) and (B) of paragraph (2); and
                    (B) such country--
                            (i) is not negotiating in good faith to 
                        reach an agreement described in subsection 
                        (a)(2); or
                            (ii) has not complied with, or a financial 
                        institution of such country has not complied 
                        with, a request, made by an official of the 
                        United States Government authorized to make 
                        such request, for information regarding a 
                        foreign terrorist organization (as designated 
                        under section 219 of the Immigration and 
                        Nationality Act), a person who is a member or 
                        representative of any such organization, or a 
                        person engaged in money laundering for or with 
                        any such organization,
        and the President imposes any penalties or sanctions on such 
        country or financial institutions of such country on the basis 
        of such determination, the Secretary of State shall submit a 
        report to the Congress describing the facts and circumstances 
        of the case before the end of the 60-day period beginning on 
        the date such sanctions and penalties take effect.

                     TITLE IV--CURRENCY PROTECTION

SEC. 401. COUNTERFEITING DOMESTIC CURRENCY AND OBLIGATIONS.

    (a) Counterfeit Acts Committed Outside the United States.--Section 
470 of title 18, United States Code, is amended--
            (1) in paragraph (2), by inserting ``analog, digital, or 
        electronic image,'' after ``plate, stone,''; and
            (2) by striking ``shall be fined under this title, 
        imprisoned not more than 20 years, or both'' and inserting 
        ``shall be punished as is provided for the like offense within 
        the United States''.
    (b) Obligations or securities of the United States.--Section 471 of 
title 18, United States Code, is amended by striking ``fifteen years'' 
and inserting ``20 years''.
    (c) Uttering Counterfeit Obligations or Securities.--Section 472 of 
title 18, United States Code, is amended by striking ``fifteen years'' 
and inserting ``20 years''.
    (d) Dealing in Counterfeit Obligations or Securities.--Section 473 
of title 18, United States Code, is amended by striking ``ten years'' 
and inserting ``20 years''.
    (e) Plates, Stones, or Analog, Digital, or Electronic Images For 
Counterfeiting Obligations or Securities.--
            (1) In general.--Section 474(a) of title 18, United States 
        Code, is amended by inserting after the second paragraph the 
        following new paragraph:
    ``Whoever, with intent to defraud, makes, executes, acquires, 
scans, captures, records, receives, transmits, reproduces, sells, or 
has in such person's control, custody, or possession, an analog, 
digital, or electronic image of any obligation or other security of the 
United States; or''.
            (2) Amendment to definition.--Section 474(b) of title 18, 
        United States Code, is amended by striking the first sentence 
        and inserting the following new sentence: ``For purposes of 
        this section, the term `analog, digital, or electronic image' 
        includes any analog, digital, or electronic method used for the 
        making, execution, acquisition, scanning, capturing, recording, 
        retrieval, transmission, or reproduction of any obligation or 
        security, unless such use is authorized by the Secretary of the 
        Treasury.''.
            (3) Technical and conforming amendment.--The heading for 
        section 474 of title 18, United States Code, is amended by 
        striking ``or stones'' and inserting ``, stones, or analog, 
        digital, or electronic images''.
            (4) Clerical amendment.--The table of sections for chapter 
        25 of title 18, United States Code, is amended in the item 
        relating to section 474 by striking ``or stones'' and inserting 
        ``, stones, or analog, digital, or electronic images''.
    (f) Taking Impressions of Tools Used for Obligations or 
Securities.--Section 476 of title 18, United States Code, is amended--
            (1) by inserting ``analog, digital, or electronic image,'' 
        after ``impression, stamp,''; and
            (2) by striking ``ten years'' and inserting ``25 years''.
    (g) Possessing or Selling Impressions of Tools Used for Obligations 
or Securities.--Section 477 of title 18, United States Code, is 
amended--
            (1) in the first paragraph, by inserting ``analog, digital, 
        or electronic image,'' after ``imprint, stamp,'';
            (2) in the second paragraph, by inserting ``analog, 
        digital, or electronic image,'' after ``imprint, stamp,''; and
            (3) in the third paragraph, by striking ``ten years'' and 
        inserting ``25 years''.
    (h) Connecting Parts of Different Notes.--Section 484 of title 18, 
United States Code, is amended by striking ``five years'' and inserting 
``10 years''.
    (i) Bonds and Obligations of Certain Lending Agencies.--The first 
and second paragraphs of section 493 of title 18, United States Code, 
are each amended by striking ``five years'' and inserting ``10 years''.

SEC. 402. COUNTERFEITING FOREIGN CURRENCY AND OBLIGATIONS.

    (a) Foreign Obligations or Securities.--Section 478 of title 18, 
United States Code, is amended by striking ``five years'' and inserting 
``20 years''.
    (b) Uttering Counterfeit Foreign Obligations or Securities.--
Section 479 of title 18, United States Code, is amended by striking 
``three years'' and inserting ``20 years''.
    (c) Possessing Counterfeit Foreign Obligations or Securities.--
Section 480 of title 18, United States Code, is amended by striking 
``one year'' and inserting ``20 years''.
    (d) Plates, Stones, or Analog, Digital, or Electronic Images for 
Counterfeiting Foreign Obligations or Securities.--
            (1) In general.--Section 481 of title 18, United States 
        Code, is amended by inserting after the second paragraph the 
        following new paragraph:
    ``Whoever, with intent to defraud, makes, executes, acquires, 
scans, captures, records, receives, transmits, reproduces, sells, or 
has in such person's control, custody, or possession, an analog, 
digital, or electronic image of any bond, certificate, obligation, or 
other security of any foreign government, or of any treasury note, 
bill, or promise to pay, lawfully issued by such foreign government and 
intended to circulate as money; or''.
            (2) Increased sentence.--The last paragraph of section 481 
        of title 18, United States Code, is amended by striking ``five 
        years'' and inserting ``25 years''.
            (3) Technical and conforming amendment.--The heading for 
        section 481 of title 18, United States Code, is amended by 
        striking ``or stones'' and inserting ``, stones, or analog, 
        digital, or electronic images''.
            (4) Clerical amendment.--The table of sections for chapter 
        25 of title 18, United States Code, is amended in the item 
        relating to section 481 by striking ``or stones'' and inserting 
        ``, stones, or analog, digital, or electronic images''.
    (e) Foreign Bank Notes.--Section 482 of title 18, United States 
Code, is amended by striking ``two years'' and inserting ``20 years''.
    (f) Uttering Counterfeit Foreign Bank Notes.--Section 483 of title 
18, United States Code, is amended by striking ``one year'' and 
inserting ``20 years''.

SEC. 403. PRODUCTION OF DOCUMENTS.

    Section 5114(a) of title 31, United States Code (relating to 
engraving and printing currency and security documents), is amended--
            (1) by striking ``(a) The Secretary of the Treasury'' and 
        inserting:
    ``(a) Authority To Engrave and Print.--
            ``(1) In general.--The Secretary of the Treasury''; and
            (2) by adding at the end the following new paragraph:
            ``(2) Engraving and printing for other governments.--The 
        Secretary of the Treasury may, if the Secretary determines that 
        it will not interfere with engraving and printing needs of the 
        United States, produce currency, postage stamps, and other 
        security documents for foreign governments, subject to a 
        determination by the Secretary of State that such production 
        would be consistent with the foreign policy of the United 
        States.''.

SEC. 404. REIMBURSEMENT.

    Section 5143 of title 31, United States Code (relating to payment 
for services of the Bureau of Engraving and Printing), is amended--
            (1) in the first sentence, by inserting ``, any foreign 
        government, or any territory of the United States'' after 
        ``agency'';
            (2) in the second sentence, by inserting ``and other'' 
        after ``administrative''; and
            (3) in the last sentence, by inserting ``, foreign 
        government, or territory of the United States'' after 
        ``agency''.

            Passed the House of Representatives October 17, 2001.

            Attest:

                                                                 Clerk.
107th CONGRESS

  1st Session

                               H. R. 3004

_______________________________________________________________________

                                 AN ACT

 To combat the financing of terrorism and other financial crimes, and 
                          for other purposes.